Posts from ‘January, 2007’

Good news on inflation. The Fed kept short term rates alone today:
Stocks rally on Fed comments on economy - USATODAY.com: “NEW YORK (AP) — Stocks shot higher Wednesday after the Federal Reserve answered two of Wall Street’s major concerns, indicating that the economy remains healthy and that inflation pressures are easing. “
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The US economy is growing faster than expected. Expect mortgage rates to react by going up a bit. When the economy is strong money flows to stocks - since you can make more there - bond prices fall and its yield (interest rates) go up.
Reuters Business News: Economy grows 3.5 percent in fourth quarter - [...]

Bank of America doesn’t like the mortgage industry business model. So maybe they’re not as interested in the Countrywide deal:
Bank of America CEO casts doubt on Countrywide deal - MarketWatch: “While Charlotte-based Bank of America wants to sell more mortgages, Lewis said, the company isn’t attracted to the mortgage industry’s business model. ‘We like the [...]

I guess winds of change are in the air. Bank of America has been pursuing a very aggressive growth strategy - mainly buying up competitors. The latest news is they’re eyeing Countrywide (whose owner is looking for a worthy suitor):
Bank of America Eyes Countrywide - Originator Times: “STAURT, FL - According to recent reports in [...]

As the story below indicates a lot of Adjustable Rate Mortgages will be adjusting this year. Many people are quick to blame the mortgage lender in putting people in this situation. Let’s look at this. First of all borrowers have saved a lot of money by taking advantage of the lower rates offered by [...]

There are lots of economic reports due to be released this week, including a Federal Reserve Meeting. The GDP report comes out on Wednesday and the Fed meets the same day. Another big one is the the jobless claims (initial) which comes out on Thursday.
The Fed should leave interest rates alone, but I’m not sure [...]

New Home Sales were reported at 1.1 million units. This is much better than market expectations of 1.05 million. The housing inventory (supply) improved to 5.9 months. This number also came in better than the expected 7.2 months (a level seen back in July). These numbers show an improving housing market. If supplies [...]

What will 2007 be like for the overall US economy? Well here is a peak at how things are point towards:
Bloomberg.com: Worldwide: “Jan. 23 (Bloomberg) — An index of leading U.S. economic indicators rose last month for the first time since September, signaling a faster economic expansion in the next three to six months. “

We seem to have hit a low point for existing home sales. See the latest December numbers (down 0.8% compared to November). For the entire year 2006 the numbers are very positive. Another reason to read the whole story (not just the headline). National Association of Realtors Economist says 2006 was one of the strongest [...]

A common question is why do a 80/20 loan when you can do just one loan and only have one payment. The common answer is you don’t have to pay mortgage insurance on a 80/20 loan and the 2nd loan payment is also tax deductible. Lenders are now offering lender paid Mortgage Insurance. Under this [...]