Weekly Mortgage Update

The voters have spoken…but I don’t think it will have much of an impact.   The economy will muddle along for a while regardless of who is in power.  A turn around is all going to depend on consumer confidence AND the Fed is trying to spark that confidence by implementing QE II.  In layman’s terms, the Fed is printing money again in hopes of creating some economic activity and mild inflation.  Most economists agree that printing money will indeed lead to inflation, and inflation will push rates up.   This leads me to the issue of your customers who are waiting before they buy.  Folks, now is the time to buy REGARDLESS.  Here’s why:

IF  buyers buy now, they get a great price and great rates.  But if they wait, guess right, and prices DID drop 5% in the next 12 months,  by the time they contracted rates will have ticked up because of the efforts of the Fed.   You see the Fed WANTS inflation and inflation pushes rates up causing  buyers to actually pay MORE for their house.  For example, let’s say your buyer doesn’t buy today with a 4% rate on a $200,000 mortgage, but waits for prices to go down and finances a $190,000 mortgage with a 5% rate.   Even though the price of the house is LOWER, the payment would actually be $65 HIGHER!  That’s almost $4,000 over 5 years.  I’m not betting my 4 grand, how about you?

This week 30 yr. fixed rates ranged between 3.875% and 4.25% depending on program, credit and points.

Ted Clay
Sr. Loan Officer
NMLSR # 217991
OK License # MLO01963

Office: 405-341-8644
Cell: 405-826-1320
e-Fax: 1-866-208-5309



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