MortgagesUndressed

Here are a couple of articles from Las Vegas Undressed author Mark Clawson to consider.

What does it mean when the Fed cuts rates?

I mentioned that weakness in the stock market can help mortgage interest rates

A Washington State Mortgage Broker: License #510-MB-31152
Larry Cragun Broker: 206.618.3724

Loan Officer: Mark Clawson: 206-999-2009

Click and see this years averages
LarrY Cragun

Mortgages Rates are Hopping Up

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Rates are up again from last week. March’s Jobs Report came in much stronger than expected (180,000 new jobs vs. 135,000) and revisions to the past two months’ Jobs Report dropped the unemployment rate to matching the lowest level in 6 years at 4.4%! All this good labor news is bad news to mortgage bonds.

Why is that?

I am noticing that a lot of folks just can’t control their desire to buy with credit cards. They cannot control having high balances. People who took a wise step in getting out of 18% credit card rates through refinancing their home are running their balances up again. The intent was good, paying off those high interest rate balances.

However I have observed:

The urge to buy is running high.
The urge to spend is in control again.

The strength to resist just does not exhist.
Being mature - a trait that doesn’t endure.

So being the pragmatist I am. (ho ho ho) I decided to make the mobs of credit card addicts my benefactors. I took my entire retirement investments and put them in the new mutual investment fund you may have heard of: “Credit Card Cocaine Fund”

“Credit Card Cocaine Fund” is a unique fund that purchases stock in companies that understand the human addiction to high balances and using up every ounce of credit limit one can acquire. It focuses on companies with research departments that identify the people that are willing to pay the highest rate of interest. It has the uncanny capacity to spot those companies that willingly raise the credit lines of those most likely to use them.

Now how about this for business savvy! One of these companies has determined how to identify the genetic propensity to become addicted to continually having credit card balances. Yes this is a fact.

These genetic marvels start receiving toy credit cards for Christmas and anonymous birthday presents beginning at age 8. This idea came from James J Smoke, who was a noted research analyist for the cigarette industry. Smoke is solely responsible for persuading the candy companies to start selling chocolate cigarettes. They had to subsidize the candy companies as this ended up in providing greater sales for the cigarette companies long term. It became a fact that the kids stopped buying the chocolate kind for the hard stuff, you know real cigarettes.

So old Smoke used this knowledge and moved on to higher income at the international advisory council for earning high rates of interest. It is said, his idea of toy credit cards is garnering him a huge bonus.

Aside from all this complicated data, is the simple fact that my retirement is in your hands, all this thanks to the new investment fund that targets the right people buying the right stuff, any stuff. That is any stuff paid by credit card.

Keep those credit card balances high please. I must retire someday.

Better yet, you could move to Addictsville, Texas (shown below) where you must make every purchase with credit cards and are subject to an annual audit proving you never pay the balances off.

Larry Cragun

Why? If it is a rate they quote it is old, cannot be current. This is what prompted this article. I have been hearing the same rate by a guy named H…….. for over a week. The rates haven’t been the same for that week or more. They only seek to suck you in, take a grueling over the phone application, wear you out, and get you.

Pick a lender that…… you know the drill. Do it right. Email me if you need me to explain.

Hey Joe, don’t get mad at me over what rate you got. It ain’t my fault the market changed twice a day since our ad promised you a 5% rate. It is your fault. You waited too long to call the office.

Playing the float game is too risky. Friday I thought factors made it worth playing the down down up lock float game. So I wrote so with a delay in publishing the article until monday. Monday I saw news that would have made me lock, but it was late in the day, too late.

Had you not locked Monday on a $300,000 loan the same rate today would cost an additional $2040.00 in loan fees. Floating can be a Las Vegas type losers game. Lar

For new readers, most of the time I say lock at application. Especially if you are on the edge of not qualifying and a rate increase would torpedo your purchase.

With all the latest business news we might see some decline.

The game is serious if played for real. It was a way I could get borrowers that just had to play the market to only play for a short time.

The rules. You don’t lock on day one. Each business day thereafter you call me about 10AM my time. If the rate goes down, you float. If it goes up you lock and have lost. Each day it goes down you float another day. The first day up you lock.

So lets play today. I will take one of our major lenders rate sheet. I will look at a par rate, no fees and no rebate. Each day I will compare and report how much in rate or fees you gained or lost. The last two times I have done this we have had a better rate. So this may be pressing our luck.

As one client says, locking or floating is just like going to Las Vegas. Yep. Except, the difference shows up in your house payment each and evey month.

Larry Cragun.

Check out of the misery. Stop rate gamble.

If you are not locked you are asking for trouble. The first week of the month I said one should stay away from gambling with rates. Since then each week the average rate has gone up. A common problem is you lose a bit, then hold on for a comeback. If you did this, you are losing. Stop playing the game and lock. Rates are still decent. Of course we could have a rebound down. But of course we could see more increases. If rates go down seriously after closing you could possibly refi. Lock Lock Lock. Ok?