From the monthly archives: February 2008

As The Fed Funds Rate Falls, 30-Year Fixed Mortgages Rise

On February 29, 2008 By

Federal Reserve Chairman Ben Bernanke testified to Congress Wednesday, alluded to further rate cuts to support an ailing U.S. economy.

Already, the Federal Reserve has lowered the Fed Funds Rate by 2.250% since September 2007.

The graph at right comes from the Wall Street Journal and it highlights a very important correlation [...]

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Mortgage Market Update – February 29, 2008

On February 29, 2008 By

Home loan rates have improved as money has left the stock market over the past few days.

The Fed’s favorite inflation measurement, the Core Personal Consumption Expenditure Index, was reported in line with estimates for the month and came in slightly higher than desired in the year-over-year report.

For today, we’re remaining cautious [...]

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Mortgage Market Update – February 28, 2008

On February 28, 2008 By

The craziness continues. After opening to the downside, Mortgage Backed Securities took off on the heels of Initial Jobless Claims. This reading of 373,000 brings the four-week moving aaverage to over 360,000. This is a level just below the level of 362,000 seen in the last two recessions.

Mortgage Backed Securities broke through a [...]

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How Is Housing Doing? It Depends Who You Ask.

On February 28, 2008 By

Yesterday, the Office of Federal Housing Enterprise Oversight released its fourth-quarter housing data.

The OFHEO report color-coded each state according to its annual price changes. The states shown in red lost value, and everyone else gained. Overall, the OFHEO measured a 0.8% national increase.

Also hitting the wires yesterday was [...]

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Mortgage Market Update – February 27, 2008

On February 27, 2008 By

Got Euro? Fed Chairman Bernanke is in front of the House Financial Services Committee today, the Senate tomorrow.

Expect our friends on the trading floors to be parsing these statements looking for the Fed’s opinion on inflation, the plunging dollar, and the uncertainty in the economy.

Stay tuned as it has been volatile. For [...]

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Real Estate Term: Earnest Money

On February 26, 2008 By

When a buyer and seller reach agreement on a home sale, the buyer typically puts a small amount of money into a trust account.

This up-front deposit is more commonly known as "earnest money".

A sales contract's earnest money requirement will vary from contract to contract. It can be as high as 10 percent [...]

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Mortgage Market Update – February 26, 2008

On February 26, 2008 By

Mortgage backed securities have recently moved to their best levels of the day after a tough open on Producer Price Index data that shows prices are on the rise.

Currently, stocks are still trading higher. This was driven by IBM’s $15 billion stock buy-back.

Looking Back And Looking Ahead : February 25, 2008

On February 26, 2008 By

It's a big week for mortgage markets (again) and that should cause rates to fluctuate wildly (again).

The volatility we've seen since December has not been for the faint of heart. Even this past Friday, as were poised to end the week lower, [...]

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Mortgage Market Update – February 25, 2008

On February 25, 2008 By

The market is experiencing another sharp drop today after failing to break through the ceiling of resistance we mentioned in last week’s posts.

There isn’t much on the economic calendar today although the Fed’s Frederic Mishkin is giving a presentation entitled, “Stabilizing Inflation.” This could move markets.

What have we learned in the [...]

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Spreadsheet Formulas: Calculating Home Payments

On February 23, 2008 By

For a lot of homebuyers, calculating a prospective mortgage payment is an online experience. For example, a search on Google for "mortgage calculator" returns 39 million options.

Some people, however, prefer to plan on their local hard drive using spreadsheets. For these people, the hardest part is often figuring out what formulas to [...]

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