Washington Mortgage Planner-straight up mortgage advice and commentary

Good morning all: I hope you're enjoying your summer so far. We've had the nicest summer weather-wise I can ever remember. It actually is rivalling the great summers I remember as a boy in my small town.

The topic du jour is golf and real estate. I was thinking about the similarities this morning. I recently played golf again after a nine month hiatus. And I played pretty well. A friend of mine exlained that I had no memory of all the bad habits I'd developed before. I could just go out and play. I think the same can be said for our real estate careers.

The last couple of years haven't always been fun. I've kept my eye on the ball pretty well but, at times, have wondered when my business will start reaping the rewards of my labors (I've been doing loans for slightly over 3 years now). Last Friday, I popped in one of Brian Buffini's Turning Point tapes. It had been a while. For those of you who don't know who Brian Buffini is, he teaches real estate and other professionals how to build their business through referral.

But I digress. The reason why I wanted to listen to Brian Buffini is I knew I needed to get back to the basics. Golf is similar. I think one of the reasons I've played better this year is I relaxed, kept my eye on the ball and didn't get upset if I hit a bad shot.

Our real estate career is similar. Most or all of us love what we do. But, sometimes, we forget what got us to where we are. That's when it's time to get back to the basics. Pop that inspirational tape in, have coffee with a referral partner, hold that Open House, write that overdue Thank You, call your database to check in. And don't sweat things so much!

Golf is a beautiful game meant to be enjoyed. Our real estate career can be too. What do you think? What are you doing to enjoy and prosper at your job? Thanks for reading! Have a great day!

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Hello all: I must be in vacation mode. This is a shot of Upper Priest Lake in northern Idaho. My family has had a lake cabin here since 1982. I've decided it's my favorite place on earth and feel fortunate to spend vacation time there. What do we do while we're there? Not too much. Obviously, we boat and we swim. We also hike, pick huckleberries and look forward to Happy Hour every day at 5!

If you've never been to Priest Lake I encourage you to go. It's about a 6-7 hour drive from Seattle and a couple hours north of Spokane. What you'll find is the most amazingly beautiful place on earth. It's like stepping back in time where cell. phones and computers don't work all the time. This is where I'm headed next week for a week. Tell me what your vacation plans are. I'm curious. And if you're ever in the area, stop in. It's our little slice of heaven! Have a great weekend!

 O.k. So I couldn't figure out how to get the picture to upload. I'm a beginner. Trust me, this lake is beautful if you've never been there. 22 miles long of unspoiled wilderness!

I'm sitting here on an absolutely glorious day in Bellevue, Washington writing this mortgage market report. We've had the nicest summer I can remember and there appears to be no letup. I hope the same can be said of you wherever you are.

I think the market is picking up, albeit slowly. We're probably always the last to get hit and the last to turn around. That being said, things were probably never as difficult as in other parts of the country. But we did have a big slowdown here just like everywhere else. This summer marks the first time since 2007 that there has been increased activity.

My company, The Legacy Group, is having a banner year. Refinancing activity has almost stopped but the purchase market is heating up. I think it's a combination of things. One, the first-time homebuyers tax credit of $8000 will expire on December 1 of this year. So first-timers want to get in on that. Two, existing buyers (move-up buyers) are sensing an opportunity to get the house of their dreams for much less and with a lower payment than before.

Our Puget Sound market is still flooded with bank-owned, short-sale, and foreclosure homes. The estimate is up to 40% of the inventory is distressed property. And the builders aren't building yet. I suspect the ones left will start again slowly next year. In other words, I'm seeing more confidence and interest in our local area. With interest rates expected to remain low for the balance of this year and inventory plentiful, home sales should continue to recover.

What are you seeing in your neck of the woods? We'd all like it to be a little more normal but I'm encouraged nonetheless! Thanks for reading this Bellevue, Washington mortgage market report!

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Good afternoon all! I hope you're well. A little over a month ago, I blogged about mortgage rates increasing drastically in the space of a few days. They literally went from 4.75% for a 30 year fixed mortgage O.A.C. to 5.5%. The reasoning seemed to be that the government stopped guaranteeing the purchase of mortgage backed securities. Thus, the sudden rise in rates.

Fast forward to today. Rates today are at 5% for a 30 year fixed conventional mortgage which is actually 1/8 point worse than yesterday. So rates have improved again. Expect continued volatility as the markets (especially oil) try and find their medium. My apologies to Kathy Toth who commented here. She asked me for an update the following week after I blogged about rates rising in late May. I thought mortgage interest rates might come back down fairly soon. In reality, it took a little over a month.

So what happened? Why the sudden downtick in rates? The big news was the economy where things didn't appear to be recovering as quickly as the pundits hoped. Once again, the stock market is off and oil prices have plunged by $10/barrel as of today. My company recently had Barry Habib (many of you may know him as one of the foremost mortgage analysts in the country) in for lunch and he predicted that mortgage interest rates may go back down to what we got used to this past Spring (think close to 4.5% for a 30 year fixed). Granted, Barry has been wrong and admits it. But I do agree with him about the fundamentals.

So...hold on to your hats! I think we may see lower rates again. But this will probably be the last time. As Barry Habib said, our worst enemy is inflation. And that's probably going to rear it's ugly head sometime next year. To combat that, the Federal Reserve will probably raise short-term borrowing rates to combat that. Yes, I know this doesn't have anything necessarily to do with mortgage interest rates (they're determined by the price of the 10 year treasury note) but if the economy starts recovering, look for mortgage interest rates to rise. I personally expect rates close to 7% or above a year from now. I will keep you posted. Those of us in the business would frankly like a little more stability but that's the nature of the game right now! Take care.

Hi all: I hope you're well. I just got off the phone with a borrower who didn't want to comply with what we needed to close their loan. I emailed the section of the underwriting handbook to him; hopefully that will get him to cooperate.

Things have changed drastically on the underwriting side the last couple of years. Borrowers who haven't had a loan in a while remember the good old days where a high credit score and lower loan-to-value was all that mattered. I hear comments again and again about how they've never had to provide this much information.

Today, I was accused of "information gathering". Frankly, that's ridiculous. Those of us in the business know that information is only shared with the lender and that's it. Almost all of my borrowers have been very understanding of what is needed to get a loan these days. I was talking with one of my co-workers recently and we actually agreed that it's easier to have cooperative customers because their mindset is they're excited they can get approved at all!

That being said, understand that we in the loan business are as frustrated as you are. If you think for one minute we enjoy asking you for that one additional piece of information, you're crazy! We do it because compliance is everything and the risk is too high if we don't have a complete file. In closing, thanks for your cooperation and understanding. There will be a time where we might not need so much from you. That will be welcomed by everyone. In the meantime, we'll get your loan done. It just may take a little more patience than usual. Thanks for reading!

Hello all: I hope you have great plans for the weekend. Here, it's beautiful once again. We've had a fabulous streak of nice weather.

I seem to be increasingly encountering difficult underwriting guidelines. I'm curious if you're seeing them too. The latest was on a loan that was supposed to close next week. Now, I'm not so sure. My borrower wanted cash out on his primary home. The problem was he recently took it out of an LLC (he had to in order to get the loan). When we tried to do a cash out refinance, it was approved by my underwriter initially and then nixed by the lender as these types of loans require six months seasoning on title. I know this rule has probably been in effect for the past year; the thing I asked my underwriter is why didn't we know this sooner. Her explanation was she just found out when submitting to the lender.

I heard recently that one lender was taking 78 days on average to close loans. We lock all ours for 55. What I'm seeing is our underwriters (we underwrite in-house) are bogged down by checking so many guidelines before issuing an approval. And sometimes when the approval is issued, the conditions can't be satisfied right away.

I have to admit it gets a little frustrating at times. I've heard this recently. We're all working harder for our money. I recently had to find a home equity line of credit for a borrower because they forgot about a dormant one they had on their home. Of course, they wanted to keep it but the lender wouldn't allow that. So I took the time to call a banker friend of mine to set my borrower up with a new line of credit.

It probably sounds like I'm ranting here but so be it. I love what I do and plan on making this a long-term career. If you're on the other side, please have patience. Those of us in the loan business will get your loan done. It's just taking longer. Hopefully the "oh by the ways" will diminish as we continue this economic recovery. Have a great day!

Hello all: I hope you're well! We're in day 51 of the new Home Valuation Code of Conduct (HVCC) and I thought I'd comment on what I've seen. From an appraisal standpoint, there really haven't been any issues. In fact, we just got a report back within a week. Granted, it's for a purchase that needs to close by July 10 but I was surprised nonetheless. The appraisal ordered before that took quite a while but that was due more to the borrower's busy schedule. Once the appraisal was done, the report was quick.

I have to admit I didn't know how the new HVCC law would play out. And I did sign the petition; mainly because I really like the two appraisers I work with. They both seem to be hanging in there even though they're not on our company's approved list. I'm seeing if it might be possible to have them added.

My conclusion? Things haven't been quite as bad as I thought they might. Either way, I'm committed to this business and told my appraisers we would adjust to this as well. So what are your experiences? Perhaps I'm the proverbially glass half full person. I welcome you to weigh in. We've had so many challenges the last few years and I honestly feel as if we're about ready to turn the corner. Have a great day!

Good morning: I hope you're enjoying your weekend. We're back to cloudy skies and drizzle after record breaking temperatures last week. I was thinking as we get into Summer if you have plans to take time off.

Yes, I know it's difficult. We're wired up and feel the need to be accessible. Even though I have several days away scheduled this summer, I'll be checking in periodically. It could be that because we're on commission we wouldn't want to miss any opportunity.

Still, I think it's important to take time away. How do you do it? Even last year when business was rough, I managed to take a couple weeks away from the office and enjoy time with my family. This summer we'll head to our own little slice of heaven (Priest Lake, Idaho) at least twice. We also have a trip to Leavenworth, WA. for a few days.

I find a day or more off recharges the batteries. Let's face it. We're in a non-stop never-ending business. Alot of us are extremely competitive too; we don't like to lose that deal to someone else. But not taking time away can lead to burnout and a bad attitude about things. I know when I need a day off. I start to get grumpy and impatient with the world around me.

What are your plans this summer? If you haven't made any, I suggest you do everything in your power to take a few days. Even if you don't go anywhere, time away from the stress will do you wonders! Here's to a great summer. Be sure to enjoy it! Take care.

Good morning all: Yesterday was a wild day. Mortgage rates just kept on getting worse. Our secondary market manager sits in the office next to me and she was glum, to say the least. I told her not to worry.

Here's what happened. The government (yes, they're the only ones buying mortgage backed securities these days) decided to take a breather yesterday. We even speculated if it was because they wanted to give everyone a breather. We've been pretty swamped lately. The so called "breather" had the bond market tanking and mortgage rates worsened by between 1/2-1% in most cases.

I believe this is short term. The government's appetite for guaranteeing mortgages is still there as they try and right our economic ship. Plus, the great unknown is the private market. Remember the private investors have effectively been on the sidelines since August 2007. It stands to reason they'll jump back in at some point.

Eventually mortgage rates will climb back up to levels we saw earlier this decade (think 7% or so). But, for now, I think our irrational fears are unfounded. I look for lower rates again, perhaps as soon as the middle of this upcoming week. Have a great day!

Hi all: I've noticed a real upsurge in my business lately. Granted, I work for one of the best and largest lenders in the whole area and I'm starting to gain traction after working my rear off for peanuts for the first 3 years. But here's what I'm noticing recently.

We started the year not knowing what was going to happen after a pretty dismal 2008 for most of us. Then the refi. boom hit and, to date, hasn't let up much. The interesting thing lately has been the purchase market. That, for all practical purposes, crashed around our feet in August 2007 after the failure of American Home Mortgage and the subsequent takeover of Countrywide by Bank of America.

Lately, I've been getting a call/day from a realtor with a potential customer. Granted, I can't help them all but am encouraged by the agents' moxie and attitude these days. I think the purchase market is starting to rebound and that's a great sign. Most of the stuff selling up here (35-40% of the market) is still short sale, foreclosure or bank-owned. But, let's face it. Our customer loves a bargain and there are plenty to be had.

I'm helping a couple with financing on a builder short-sale and the bank who holds the note is in trouble. Plus, the realtor is a crackerjack. This doesn't mean it will happen but I think there's a pretty good chance. I encourage all of you to keep your chin up. Better days are definitely right around the corner. How are you doing in your neck of the woods? I'm curious. Thanks for reading!