MARKET SURVEY 12/17/15

Weekly Mortgage Interest Rate Report December 17, 2015

Week ending on 12/17/15 Average Rate Points & Fees Margin  30-Year Fixed Rate 3.97% 0.6 N/A  15-Year Fixed Rate 3.22% 0.5 N/A  5/1-Year Adjustable Rate 3.03% 0.4 2.75  1-Year Adjustable Rate 2.67% 0.2 2.74  Week ending on 12/10/15 Average Rate Points & Fees Margin  30-Year Fixed Rate 3.95% 0.6 N/A  15-Year Fixed Rate 3.19% 0.5 N/A  5/1-Year Adjustable Rate 3.03% 0.5 2.75  1-Year Adjustable Rate 2.64% 0.2 2.74 “As was almost-universally expected, the Federal Open Market Committee (FOMC) of the Federal Reserve elected this week to raise short-term interest rates for the first time since 2006. We take the Fed at its word that monetary tightening in 2016 will be gradual, and we expect only a modest increase in longer-term rates. Mortgage rates will tick higher but remain at historically low levels in 2016. Home sales will remain strong, but refinance activity should cool somewhat.” – Sean Becketti, chief economist, Freddie Mac

Data and information is provided by Freddie Mac's Primary Mortgage Market Survey® (PMMS)

This is not intended as an advertisement of interest rates as defined by Regulation Z, Section 1026.2. Data is provided for informational purposes only. The financial and other information contained herein speaks only as of the date posted herein. Freddie Mac, and/or the sender of this information, is not responsible for business decisions made based on the reported results of the PMMS. In general, the data presented were calculated from information collected Monday through Wednesday of the same week that the PMMS is released and may not reflect mortgage rates, fees or points currently available. Average fees and points are provided to reflect the total upfront cost of obtaining a mortgage. Borrowers may still pay closing costs which are not included in the survey.

TRID UPDATE

Thanks to the large amount of preparation and education from our Corporate Team, the hard work of our Loan Officers, Processors and Closers and the incredible synergy with our Realtor Partners, Fairway has closed 4,778 TRID files since October!

Haven't closed a loan with Fairway since October? Give a try and find out just how easy it is!

FED HIKE - DOES IT MATTER?

Why the Fed move doesn't matter to mortgage rates

Diana Olick | @DianaOlick

Thursday, 17 Dec 2015 | 1:39 PM ETCNBC.comThe Federal Reserve did it — raised the target federal funds rate a quarter point, its first boost in nearly a decade. That does not, however, mean that the average rate on the 30-year fixed mortgage will be a quarter point higher when we all wake up on Thursday. That's not how mortgage rates work. 

Mortgage rates follow the yields on mortgage-backed securities. These bonds track the yield on the U.S. 10-year Treasury. The bond market is still sorting itself out right now, and yields could end up higher or lower by the end of the week.

The bigger deal for mortgage rates is not the Fed's headline move, but five paragraphs lower in its statement:

"The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction, and it anticipates doing so until normalization of the level of the federal funds rate is well under way."

When U.S. financial markets crashed in 2008, the Federal Reserve began buying billions of dollars worth of agency mortgage-backed securities (loans backed by Fannie Mae, Freddie Mac and Ginnie Mae). As part of the so-called "taper" in 2013, it gradually stopped using new money to buy MBS but continued to reinvest money it made from the bonds it had into more, newer bonds.

"In other words, all the income they receive from all that MBS they bought is going right back into buying more MBS," wrote Matthew Graham, chief operating officer of Mortgage News Daily. "Over the past few cycles, that's been $24-$26 billion a month — a staggering amount that accounts for nearly every newly originated MBS."

At some point, the Fed will have to stop that and let the private market back into mortgage land, but so far that hasn't happened. Mortgage finance reform is basically on the back-burner until we get a new president and a new Congress. As long as the Fed is the mortgage market's sugar daddy, rates won't move much higher.

Read More  What a Fed rate hike means for you

"Also important is the continued popularity of US Treasury investments around the world, which puts downward pressure on Treasury rates, specifically the 10-year bond rate, which is the benchmark for MBS/mortgage pricing," said Guy Cecala, CEO of Inside Mortgage Finance. "Both are much more significant than any small hike in the Fed rate."

Still, consumers are likely going to be freaked out, especially young consumers, if mortgage rates inch up even slightly. That is because apparently they don't understand just how low rates are. Sixty-seven percent of prospective homebuyers surveyed by Berkshire Hathaway HomeServices, a network of real estate brokerages, categorized the level of today's mortgage rates as "average" or "high." 

The current rate of 4 percent on the 30-year fixed is less than 1 percentage point higher than its record low. Fun fact, in the early 1980s, the rate was around 18 percent.

"The Fed is seeing more people going back to work, and with the expectation of job growth for America it feels comfortable with its intent to raise rates," said Berkshire Hathaway HomeServices President Stephen Phillips. "But the reality is that an entire generation of first-time buyers has never experienced a meaningful rate increase. This is a new and unfamiliar phenomenon to them."

An increase from the current 4 percent on the 30-year fixed to 4.25 percent on a loans ranging from $200,000 to $300,000 would amount to less than the average borrower probably spends at Starbucks every month. Still, a majority of respondents to the Berkshire survey, which was mostly millennials and Gen Xers, said rising mortgage rates would make them "anxious" about their current financial situations.

Another survey by real estate brokerage Redfin appeared less dire, claiming its buyers said they were "unfazed" by the prospect of rising rates. Just 6 percent, according to the report, seemed to care at all. They were far more concerned with rising home prices and the very tight supply of homes for sale.

The exception, of course, was among what Redfin referred to as "budget-conscious buyers shopping for the least-expensive houses." Redfin categorized them as buyers looking at homes priced $250,000 or less. Seventy-one percent of them said they were concerned. 

Interesting, given that the median price of an existing home sold in America in October was $219,600, according to the National Association of Realtors. Of course Redfin is based in Seattle, where the median home price is more than twice the national average. That may be clouding their view of a "bargain." 

In fairness, Zillow, a real estate listing company also based in Seattle, put out a report this week claiming 70 percent of potential homebuyers it surveyed nationwide said they would not abandon their buying plans if mortgage rates were to hit 4.5 percent.

Suffice it to say, home buying is the most emotional financial investment most people will ever make. Whether or not every penny matters, the prospect of every penny lost or gained matters. 

CORRECTION: An earlier version misstated where Zillow is based.

NEW Loan Program Offered by Fairway!

HomeReady™, the enhanced affordable loan program from Fannie Mae was released this week. Fairway Independent Mortgage branches in Arizona began offering the product Monday.

Below is a quick Fact Sheet on the product. For more information, to see if your Buyer qualifies, and for a co-branded flyer, contact a Fairway Loan Officer today.

HomeReady™ Mortgage

Help meet the diverse needs of today’s buyers with HomeReady, Fannie Mae’s enhanced affordable lending product.

Overview
Designed for creditworthy, low- to moderate-income borrowers, with expanded eligibility for financing homes in designated low-income, minority, and disaster-impacted communities.
HomeReady lets you lend with confidence while expanding access to credit and supporting sustainable homeownership.

• Simplicity and certainty for lenders
  
• Improved pricing and execution
  
• Product features designed to align with today’s buyer demographics and support sustainable
  homeownership
  

Borrower Benefits Accessible and Sustainable Financing

Low down payment. Up to 97% financing for home purchase with many borrower flexibilities. Flexible sources of funds can be used for the down payment and closing costs with no minimum contribution required from the borrower’s own funds (1-unit properties). Conventional home financing with cancellable monthly MI (per Servicing Guide policy); reduced MI coverage requirement above 90% LTV supports competitive borrower payment. Homeownership education helps buyers get ready to buy a home and be prepared for the responsibilities of homeownership. The required training offers an easy-to-use, online course provided by Framework.

Income Eligibility
(Aligned with Fannie Mae’s regulatory housing goals and may help lenders meet applicable Community Reinvestment Act goals)

No income limit: Properties in low-income census tracts 31% of census tracts

100% of AMI: Properties in high-minority census tracts and designated disaster areas

20% of census tracts

80% of AMI: All other properties 49% of all U.S. census tracts

AMI = area median income (AMI data source: FHFA)

Product Features

• DU will automatically identify potentially eligible loans.
  
• Underwriting flexibilities include:
   Offers an innovative new feature that supports extended family households: will consider income from a non-borrower household member as a compensating factor in DU to allow for a debt-to-income (DTI) ratio >45% to 50%.
  
  •   Allows non-occupant borrowers, such as a parent.
    
  •   Permits rental income from an accessory dwelling unit (such as a basement apartment).  Allows boarder income (updated guidelines provide documentation flexibility).
    
• Financing up to 97% LTV (DU is required for LTVs >95%). Borrower is not required to be a first-time buyer; purchase of one-unit principal residence (limited cash-out refi up to 95%).
  
• Lower MI coverage requirement than standard (25% for LTVs >90% to 97%).
  
• Allows for nontraditional credit.
  
• Gifts, grants, Community Seconds®, and cash-on-hand permitted as a source of funds for down
  payment and closing costs.
  
• Supports manufactured housing up to 95% and HomeStyle® Renovation (approved lenders) to 95%.
  Homeownership Education and Post-Purchase Support
  Comprehensive homeownership education. Requires online course provided by Framework, and offers additional post- purchase support through the life of the loan to help ensure sustainable homeownership.
  
  • Borrowers will invest 4−6 hours (average) of their time and a modest fee of $75 (paid to Framework) to learn the fundamentals of buying and owning a home, take an online test, and receive a certificate of completion.
    
  • Although one-on-one counseling is optional for HomeReady, Framework will offer borrowers a referral to a HUD-approved counseling agency for additional assistance. Borrowers also have the option to consult a counselor of their choice.
    
  • To further promote sustainability, borrowers will have access to post-purchase homeownership support for the life of the loan through Framework's homeownership advisor service. 
    

MARKET NEWS

Mortgage Lenders Expect to Continue to Ease Standards: Fannie

By Andy Peters
December 17, 2015

National Mortgage News

Lenders continued to ease loan standards across all types of mortgage products in the fourth quarter and they expect the trend to continue, according to Fannie Mae.

The share of lenders who said they expect to ease standards rose to 16%, compared to the share of lenders who said they expect to tighten standards, which fell to 2%, Fannie Mae said in its latest Mortgage Lender Sentiment Survey.

Additionally, 17% of lenders said they eased standards in the fourth quarter, while just 2% tightened them. In the fourth quarter of 2015, 9% of respondents eased while 6% tightened.

Their responses applied to both GSE-eligible loans and non-GSE-eligible loans.

"Thoughtful easing will help mitigate some of the affordability decline," Doug Duncan, Fannie Mae's chief economist, said in a news release.

MARKET SURVEY 12/10/15

Weekly Mortgage Interest Rate Report December 10, 2015

Week ending on 12/10/15 Average Rate Points & Fees Margin  30-Year Fixed Rate 3.95% 0.6 N/A  15-Year Fixed Rate 3.19% 0.5 N/A  5/1-Year Adjustable Rate 3.03% 0.5 2.75  1-Year Adjustable Rate 2.64% 0.2 2.74  Week ending on 12/03/15 Average Rate Points & Fees Margin  30-Year Fixed Rate 3.93% 0.6 N/A  15-Year Fixed Rate 3.16% 0.5 N/A  5/1-Year Adjustable Rate 2.99% 0.5 2.75  1-Year Adjustable Rate 2.61% 0.3 2.74 “The economy added 211,000 new jobs in November exceeding analysts' expectations, and the prior two months were revised higher as well. This momentum is likely to cement a decision by the Fed to begin raising interest rates this month. Following the release of the employment report, Treasuries rose 7 basis points and in response the 30-year mortgage rate ticked up two basis points.” – Sean Becketti, chief economist, Freddie Mac

Data and information is provided by Freddie Mac's Primary Mortgage Market Survey® (PMMS)

This is not intended as an advertisement of interest rates as defined by Regulation Z, Section 1026.2. Data is provided for informational purposes only. The financial and other information contained herein speaks only as of the date posted herein. Freddie Mac, and/or the sender of this information, is not responsible for business decisions made based on the reported results of the PMMS. In general, the data presented were calculated from information collected Monday through Wednesday of the same week that the PMMS is released and may not reflect mortgage rates, fees or points currently available. Average fees and points are provided to reflect the total upfront cost of obtaining a mortgage. Borrowers may still pay closing costs which are not included in the survey.

SOCIAL SHARE FOR YOUR WEEKEND

Copy/Paste below link onto your Facebook or LinkedIn. Keeping followers informed keeps you top of mind!

LINK TO SHARE:  http://www.azcentral.com/story/entertainment/seasonal/2014/12/04/metro-phoenix-sparkles-light-displays-year/19852641/

Phoenix area sparkles with 24 light displays this year

                   Kayla S. Samoy, The Republic | azcentral.com 1:13 p.m. MST December 2, 2015

1:13 p.m. MST December 2, 2015

(Photo: Pat Shannahan/The Republic)

Our big list of holiday light events and displays around the Valley totals two dozen.

It includes festivals, parades, tree lightings, a block party, luminarias, ice skating, snow and the jolly old elf himself. There’s even a tribute to military members, veterans and first responders

So put on your cutest (or ugliest) Christmas sweater and venture out into the December chill with family and friends to enjoy the warm glow.

Arizona Temple Christmas Lights and Concerts

The temple grounds will be decorated with a nativity scene and Christmas lights and there will be live music nightly at 7. Performers include local children’s, handbell and adult choirs, including the Resonance Vocal Ensemble, Inspire Chorus and Spirit of Phoenix Choir. Visit the website for the full schedule.

Details: 5-10 p.m. daily. Through Dec. 31. Arizona Temple, 525 E. Main St., Mesa 480-964-7164, mesachristmaslights.com.

Las Noches de Las Luminarias

The Desert Botanical Garden will glow from the candlelight of thousands of luminarias as you walk among the plants and trees in the night. Along the way, sip a cup of hot cider and listen to the holiday sounds of carolers, handbell choirs and mariachi bands.

Details: 5:30-9:30 p.m. Dec. 3-6 (members only); Dec. 10-13; Dec. 16-23; Dec. 26-31. 1201 N. Galvin Parkway, Phoenix. $30; $12.50 for ages 3-12. Members: $25; $10 for ages 3-12. 480-941-1225, dbg.org.

                  READ MORE

FOOD DRIVE EXTENDED

The 1,000 LB Food Drive has been extended to December 23rd! We want to collect as many donations as possible before the Holidays.

Please stop by one of the Fairway Branches listed below and help us hit the 1,000LB goal!

Please help participating Arizona branches of Fairway Independent Mortgage collect nutritious non-perishable canned and boxed foods for St. Mary’s and United Food Bank. Our goal, between 6 participating branches, is 1,000 pounds for the hungry men, women and children of Phoenix and surrounding areas. Stop by a collection branch today! Nov 17 - Dec 4 (Locations below)

MOST NEEDED ITEMS: PEANUT BUTTER / CHILI / SOUPS / TUNA / BEANS / CANNED VEGGIES / CANNED FRUITS / CEREAL / RICE / PASTA / CAT + DOG FOOD

DATES:
NOVEMBER 17TH - DECEMBER 23 (MON-FRI / 9AM-5PM)

COLLECTION LOCATIONS

CHANDLER:
55 N. ARIZONA PLACE, #103, CHANDLER 85225

TEMPE:  
950 W. ELLIOT ROAD, #126, TEMPE 85284

BILTMORE:  
2325 E. CAMELBACK ROAD, #100, PHOENIX 85016

NORTH PHX: 
5450 E. HIGH STREET, #275, PHOENIX 85054

SCOTTSDALE:
7047 E. GREENWAY PKWY, #220, SCOTTSDALE 85254

GILBERT: 
2218 E. WILLIAMS FIELD RD, #260, GILBERT 85295

AGENT BUSINESS BUILDING

5 Success Tips for New Realtors®

By Anna Spooner on December 9, 2015 - Real Estate Marketing Magazine

When starting out as a Realtor®, it can seem really tough to find clients and enjoy a high level of success. There is a lot of competition in this industry! But, don’t get discouraged – you can find success and build a name for yourself. Here are five tips help you launch a successful career as a Realtor®.

Set Your Goals and Come Up with a Plan

Just like with any other business venture, a Realtor® needs to have a business plan. I don’t necessarily mean a long, formal, complex document. In your business plan, you define your marketing strategy, your target market, and your overall plan of attack. By having a document to refer to, you can avoid many pitfalls that new Realtors® face. Every Realtor® should treat their job of selling homes as a business. You’re in business for yourself, so make a plan to succeed!

Concentrate on a Niche to Develop Trust

As a Realtor®, you will have a lot of competition, and it’s hard to stand out from the pack. One way to do so is to have a niche. You could specialize in, for example, luxury homes, condominiums or homes in the countryside. With a specialization, you can build a name for yourself as a Realtor®. Then, you will have an easier time attracting clients via word-of-mouth. Remember, when you select your niche, you should make sure that it’s a viable one as you don’t want to paint yourself into a corner.

Use Social Media to Build Relationships and Gain Referrals

Social media is a great tool to build contacts and relationships and gain referrals. Ideally, if you are a new Realtor®, you should choose one to three social media platforms that your ideal customers spend time on. Don’t overextend yourself, but invest time in forming relationships online. By signing up for social media accounts and providing up-to-date, relevant and interesting information, you can communicate with current and potential clients with ease.

Focus on Promoting Listings to Increase Your Visibility

Print media and traditional mail is far from dead, especially for Realtors®. You can stand out and generate interest in your listings and your business with a variety of printed material. Just Listed Postcards help you let potential buyers know about a new property on the market, and seasonal postcards can help you maintain your relationships with your prospects. Printed materials sent in the mail are very effective and can help you target your ideal clients.

Find a Mentor to Help You Avoid Common Mistakes

A new Realtor® will make mistakes, and it’s part of the learning process. It’s easy to waste money on ineffective strategies, and a new Realtor® can easily lose clients without knowing why. That’s why it’s important to try to find a mentor in the industry. It helps you avoid costly and time-consuming mistakes. When you find a mentor who matches your style and is willing to show you the ropes, you will be light years ahead of other new Realtors®.

As a new Realtor®, you must have a plan, define your market and take advantage of social media. To market yourself better, you need to use printed postcards and advertising to get people to check out your properties and stay in touch with prospects. By following these ideas and learning from people in the industry, you will be well on your way to finding success as a Realtor®.

What other success tips do you have for new Realtors®? Please share in the comments!

MARKET NEWS

Mortgage rates are in a holding pattern

Dec 10, 2015, 10:26am EST

While the markets fret about the Federal Reserve’s December rate meeting, mortgage rates continue to show little movement.

Freddie Mac’s (OTC: FMCC) weekly rate report says a 30-year fixed-rate mortgage averaged 3.95 percent in the week ending Dec. 10, up just lightly from 3.93 percent last week. A year ago, 30-year rates averaged 3.93 percent.
Enlarge


Freddie Mac's weekly rate report shows average rates on 30-year mortgages were little… more

PATRICK T. FALLON

A 15-year fixed-rate mortgage averaged 3.19 percent this week, up from 3.16 percent. A one-year adjustable-rate mortgage averaged 2.64 percent, up from 2.61 percent.

Thirty-year rates in the Northeast and Southeast were slightly higher, averaging 3.98 percent this week.

The lowest rates are in the West, where 30-year rates averaged 3.92 percent this week.


Jeff Clabaugh covers general assignment and provides business coverage for WTOP.

MARKET SURVEY 12/3/15

Weekly Mortgage Interest Rate Report December 3, 2015

Week ending on 12/03/15 Average Rate Points & Fees Margin  30-Year Fixed Rate 3.93% 0.6 N/A  15-Year Fixed Rate 3.16% 0.5 N/A  5/1-Year Adjustable Rate 2.99% 0.5 2.75  1-Year Adjustable Rate 2.61% 0.3 2.74  Week ending on 11/25/15 Average Rate Points & Fees Margin  30-Year Fixed Rate 3.95% 0.7 N/A  15-Year Fixed Rate 3.18% 0.6 N/A  5/1-Year Adjustable Rate 3.01% 0.5 2.75  1-Year Adjustable Rate 2.59% 0.3 2.74 “Treasury yields ticked down 3 basis points after weak manufacturing data. In response, the 30-year mortgage rate dropped 2 basis points. After the survey closed, Yellen implied that the economy is ready for a rate hike in December. However, all eyes remain on this Friday's jobs report, the last significant release prior to the FOMC's meeting.” – Sean Becketti, chief economist, Freddie Mac

Data and information is provided by Freddie Mac's Primary Mortgage Market Survey® (PMMS)

This is not intended as an advertisement of interest rates as defined by Regulation Z, Section 1026.2. Data is provided for informational purposes only. The financial and other information contained herein speaks only as of the date posted herein. Freddie Mac, and/or the sender of this information, is not responsible for business decisions made based on the reported results of the PMMS. In general, the data presented were calculated from information collected Monday through Wednesday of the same week that the PMMS is released and may not reflect mortgage rates, fees or points currently available. Average fees and points are provided to reflect the total upfront cost of obtaining a mortgage. Borrowers may still pay closing costs which are not included in the survey.

SOCIAL SHARE FOR YOUR WEEKEND

Copy/Paste below link onto your Facebook or LinkedIn. Keeping followers informed keeps you top of mind!

LINK TO SHARE:  http://www.azcentral.com/story/entertainment/events/2014/12/05/biggest--upcoming-events--metro-phoenix/19965839/

Biggest and best upcoming events around Phoenix

12/12 FANTASY OF LIGHTS BOAT PARADE

The Republic | azcentral.com

You won't want to miss any of these concerts, festivals and other events in the weeks ahead. Check events.azcentral.com for details.

MARKETING CORNER

5 Places To Generate Leads Outside The Office

By Anna Spooner on December 2, 2015 - Real Estate Marketing Magazine

As a Realtor®, you’re likely skilled in communicating over the office phone with clients. You’ve probably answered hundreds of emails in the past week. Your online lead generation techniques are, no doubt, primed and seamless. But even in a marketplace that is increasingly moving towards online communication as a means of contact with clients, leads developed outside the office hold tremendous value. Here, I’ll outline five places you can generate leads as a Realtor® outside the office environment.

Chat with vendors

Industry trade shows offer you the opportunity to meet with others in the real estate marketplace, as well as professionals within related fields such as construction. These events can be an environment in which to exchange business cards with construction business leaders and to highlight your recent success to promote your realty business. By talking to contractors, title companies, inspectors and other people in the know, you can score some solid leads and get your name out there. A great benefit of talking to vendors and people in the industry is that you can build long-term relationships, which is key for any Realtor®.

Local business associations

If you aren’t going to local business associations, you are missing out on plenty of opportunities. Not only can you find other like-minded business people to share strategies with, you can find potential clients. Attending these events allows you to stand out when compared to a Realtor® who only has a website and Facebook page. Use the opportunity to chat with people and get ideas flowing. Share tips and ideas about real estate, and ask people what their current needs are. This unique venue will help you connect with prospects in a way that has very little competition from other Realtors®.

At School Events

As a Realtor® you likely have deep roots within your local community. These roots can be harnessed to further develop your business. Many Realtors® are now working with local schools to help engage students within the learning process. You might use your knowledge of the marketplace to speak at career days for high school students. Or you might organize a school fundraising event. With the latest tools for organizing groups on social media, this type of initiative is rarely expensive or time consuming. You’ll be seen as a local business leader within the community and you can use this role to maximize contacts with parents, teachers, and a variety of other possible prospects.

At a Local Organization through Sponsorship

Your investment in the community can have recurring value for your real estate business. One way to make this happen is through sponsorship. Of course, it’s important that you carefully select the sponsored organization. You could have sponsorships at events like 5K runs or fundraising for a local fire departments. You might also consider sponsoring a local animal shelter event as well, or events that are targeted at your specific farm neighborhood or demographic. These events allow you to connect to prospects in a way that is focused on charity rather than sales.

The World is Your Office

Although it can sometimes be uncomfortable, talking to strangers you meet can be a rich source of leads. You need to keep your business mindset on, and make sure your professional business cards are ready. Realtors® offer a very real and important service that people need when they are buying and selling a home. When you engage people and offer your services, you’re doing them a big favor and saving them a lot of heartache down the road. See everyone you meet as an opportunity for a connection and conversation, and then keep those relationships going. You never know when someone is ready to buy or sell, or who they might know that’s ready for a real estate transaction today.

These techniques can help you expand your real estate business and build significant connections throughout your local community, without sitting at your desk all day. What are your go-to lead generation techniques outside your office? Let me know in the comments below.