What are Japanese Candlesticks? Why are they important?

I watch the bond market, stock market, futures, inflation, unemployment, housing demand, refinance and home purchase activity, world news, national news, political developments, gas prices and yes, I even watch the weather for signs of what the market will be doing in the future.

Giving reliable advice to my clients as to whether they should LOCK or FLOAT their interest rate when they have a mortgage application with me is a major goal of mine.  Their decision (based on my advice) has long term consequences and if they (and I) choose wisely so that they can maximize their investment return on their mortgage.

A mortgage is another form of investment strategy, but this is a whole blog post to come in the future.  I look forward to talking about the value of a "Big FAT 30 year mortgage" in a future Blog Post.

But today, what I want to talk about is what I use to gauge what is going on in the market TODAY, right this moment, and is something available to me and it's called "Japanese Candlesticks".  I would like to explain why this is valuable and important to me AND to my clients who are relying on my expertise and guidance,

What you see below is today's Japanese Candlesticks Chart (4%, 30 year bond yields) and it is showing lots of green "candles".  Green is Good!  It means that mortgage rates are improving or the market is favorable.  The last green candle on the far right of the chart (right next to the S1 in the blue box) is today's market activity.

Tomorrow's rates should (unless the market changes dramatically overnight or in the early hours of trading in New York tomorrow morning) be about the same, possibly better than they were today.

Yesterday's rates were worse than today's (the red candle shows a lower price, higher mortgage rate than today's), and so forth backwards.  Over the past 17 trading days the rates have been close to, above or just below the best rates in 17 months (best since May 8, 2013).

The S2 line, below the candlesticks, is the FLOOR of SUPPORT and with the rates close to this floor, if the bond prices begin to break below this floor, like happened yesterday for two hours, we COULD see the mortgage bond prices begin to deteriorate and we could see these great rates go away  (go up!) and this could be forever or temporarily, that is the gamble of NOT taking advantage of rates today.  

Call me today if I can help with analysis for your mortgage refinance or purchase.  :)

What's FHA financing all about?

FHA loans in 1991:
When I became a mortgage loan originator in 1991, I couldn't believe that there was a loan product which allowed all of the down payment to be gifted!  "Are you sure this is true?", I asked my mortgage lender buddy who had come over to the mortgage department at the bank we were with just 6 months before.  "It's true!  Can you believe how great of a program it is?"  That was my first impression of how great the FHA loan was because it lowered the barriers to home ownership for first time buyers.

FHA loans today: 
The FHA loan is a great fit for first time home buyer's and others with specific lending needs.  Since 1991 I have learned much about lending and about FHA.  I now know that FHA is a loan insurer not a lender, and that the loan is available to both first time home buyer's needing 100% financing (Utah Housing Loans/State Bond Programs), and it's a great alternative for buyer's who have less than perfect credit (my company, Primary Residential Mortgage, has a 580 credit score FHA loan program!).  FHA offers streamline loans to allow homeowners to lower their interest rate with NO COST (ZERO will be added to their existing loan balance, no appraisal required).

With FHA rates at their lowest in 17 months ( June, 2013), this is a great time for buyer's and current FHA loan holders to utilize purchase and refinance options!  Call me today for a more thorough analysis and discussion about what program's fit your needs the best.

Lots of buyer activity for Q4, 2014

The fall months are no longer a real estate dead zone, and there is still plenty of action happening after Labor Day through Christmas.  An article in the October 18, 2014 Ogden Standard Examiner said that Davis County home sales were up 7% and Weber County were up 4% when compared to the same August time in 2013. Pending sales (homes under contract which will close in October) were up 22%, showing significant momentum for home sales as we enter into the beginning of Q4.  

By Brendon DeSimone on 26 Sep 2014

Fall officially began Sept. 23, but that doesn’t mean you should scrap plans for selling your home this year. In fact, October, November and December can actually be good months to sell. Now is the time to plan for it if you’ve even considered putting your home on the market.

Now that rates have fallen, HOW should I refinance my home loan?

Refinance today before rates go up!

It's an interesting study just completed and the findings released.  The average age of a refinanced loan is now 7.3 years, up two years from what it was last year and 3 times as long as the latest 10 year average.  In other words, there are over $800 million in mortgage loans today which have a higher than 5% interest rate!  Yours may be one of them.

With current 30 year rates hovering near 4% and 15 year at 3.5%, there can be substantial savings associated with refinancing.

But what about the cost associated with refinancing?
Does a homeowner REALLY need to save 1% on their mortgage to justify doing a refinance?
Why is 1% savings the "magic" number?

There are two ways to look at doing a refinance; 1) the rule of thumb 1% savings in interest rate, and 2) ZERO closing cost refinance-PURE savings because all you are doing is lowering your interest rate.

Buying a home BEFORE winter

 It’s that time of year, the seasons are changing and with them bring thoughts of the upcoming holidays, family get togethers, and planning for a new year. Those who are on the fence about whether now is the right time to buy don’t have to look much farther to find four great reasons to consider buying a home now, instead of waiting.

Why buying a home before winter makes sense

1. Prices Will Continue to Rise

The Home Price Expectation Survey polls a distinguished panel of over 100 economists, investment strategists, and housing market analysts. Their most recent report released recently projects appreciation in home values over the next five years to be between 11.2% (most pessimistic) and 27.8% (most optimistic). The bottom in home prices has come and gone. Home values will continue to appreciate for years. Waiting no longer makes sense.

2. Mortgage Interest Rates Are Projected to Increase

Although Freddie Mac’s Primary Mortgage Market Survey shows that interest rates for a 30-year mortgage have softened recently (best mortgage rate of the year, today 10/7/14), most experts predict that they will begin to rise later this year. The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in unison projecting that rates will be up almost a full percentage point by the end of next year. An increase in rates will impact YOUR monthly mortgage payment. Your housing expense will be more a year from now if a mortgage is necessary to purchase your next home.

3. Either Way You are Paying a Mortgage

As a recent paper from the Joint Center for Housing Studies at Harvard University explains: “Households must consume housing whether they own or rent. Not even accounting for more favorable tax treatment of owning, homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord plus a rate of return. That’s yet another reason owning often does—as Americans intuit—end up making more financial sense than renting.”

4. It’s Time to Move On with Your Life

The ‘cost’ of a home is determined by two major components: the price of the home and the current mortgage rate. It appears that both are on the rise. But, what if they weren’t? Would you wait? Look at the actual reason you are buying and decide whether it is worth waiting. Whether you want to have a great place for your children to grow up, you want your family to be safer or you just want to have control over renovations, maybe it is time to buy.

Bottom Line

If the right thing for you and your family is to purchase a home this year, buying sooner rather than later could lead to substantial savings.  

Mortgage questions?  Call 801-540-5108

Realtor referral available upon request

To get the ball rolling in your discussion about selling your home, I can help with mortgage questions you might have.  As a first step, it's always good to get an analysis of your current situation and to then get a credit approval into your hands.  Call me at 801-540-5108 with your mortgage questions.  

If you need a qualified Real Estate Professional to help with your home search, I can refer you to one of my trusted Realtor Business Partners for a worry free and pleasant home buying experience.  

Selling your home NOW or in the winter?

Winter!  Just hearing the word and thinking of the season puts a chill in many homeowners minds, ESPECIALLY if you are thinking of selling your home.

After 24 years in the mortgage business, I love WINTER and the brisk real estate business of buying and selling that it creates.  Fall and winter brings excellent opportunities to negotiate a sale of your home and relocate to a new home that will meet your new home needs (upsizing or downsizing), put you closer to family, or advance your career with a job opportunity that is suddenly on your radar.

Winter is NOT a season to be afraid of if you are wanting to sell your home!  The latest foot traffic numbers provided by the National Association of Realtors shows that there are more buyer's looking at homes than in any other time in the past 12 months (MORE than in the Spring, 2014!).

Nationally, the housing supply is under the historical number of 6 months of supply and with more sellers reaching a positive equity position (19% of home value appreciation projected from now to 2018), more homes will be entering the market beginning in 6 months from now!  BEAT your competition and list your home now!

In the National Association of Realtors latest poll, 59% of buyer's would prefer (or had no preference when compared to purchasing a new home) purchasing an existing home!  Demand is in favor of an existing home selling in our present market!

I'm excited for this time of year (and this year specifically) because, as the temperatures begin to drop, demand will be heating up!

To begin the home listing process contact your favorite Realtor, and if you don't have one, call me and I'll refer you to someone who I know will take perfect care of your real estate questions and needs!

When I sell my home, what will my net proceeds be?

When you buy your home it seems that everything can go your way.  You ask for a lower sales price, it usually happens and you get it or at least you meet somewhere between the "asking price" and what you would dream of getting the home for (the "bargain price").  

By accepting the discounted price, is that all the seller is having to pay to market and close on the sale of their home?  Of course not and agreeing on the price is only the first step.  From the meeting of the minds on sales price, the seller needs to figure in additional costs associated with marketing and selling (and closing) their home.  

In general, a seller will be looking at between 4% and 7% of the sales price in selling costs, and this doesn't take into consideration helping the buyer with their closing costs and prepaid expenses, if the buyer asks for this help and is obtaining mortgage financing to fund their purchase.  

A Realtor helping a seller market and sell their home will itemize expenses to be paid at closing and will provide a "seller net sheet" to help see what net profit the seller will be receiving from the sale of their home. 

As the seller, included in the net sheet expenses are the following (some or all may apply):

Hurry, inflation will usher in higher mortgage rates!

Economic data ramps up this week and ends with the "Big Enchilada" on Friday, August 1st, with the July Jobs Report.

In the first half of this year, there has been an average of 230,000 new jobs created per month, above the 203,000 recorded per month in the first half of 2013.

Can these numbers be sustained and perhaps even move higher in the second half of the year?

If the numbers remain constant or increase, we could see inflationary worries, the arch enemy of bond prices.  As bond prices suffer (go down) because of inflation, or inflationary worries, rates will go in the opposite direction (go up).  

Today's additional headline was, "Worker's raises are back in vogue", raises additional worries that products will cost more at the wholesale level.  The monthly wholesale inflation report can be a market mover, but so far has been tamed by the unsettled world military climate overseas.  

As the summer draws to a close, it may be the perfect time to consider purchasing a first home, selling and upgrading or downsizing or looking at the 2nd home or investment home market.  

Winning a Competitive Bidding War

Emotions can play a big role in the hot (temperature and real estate selling and buying activity) summer months.  Summer 2014 has created a balance of sellers and buyers and with it comes competition among buyer's.  There are ways to prevent paying too much for the house that you are interested in, even though you might feel that you need to increase your bid amount so you can be successful in "sealing the deal".

When in a competitive bid war there are some basic steps to take in order to not pay too much for the house you are bidding on:

1. Ask yourself, "is this really the house I want?"  Sometimes you will be able to step back and ask this objective question and it will cool off your emotions and you can make a level headed decision about "how high should I go with my offer?"

Inflation worries mean higher mortgage interest rates?

Inflation is the arch enemy of mortgage bonds and erodes bond prices.  The lower the bond price goes, the higher the mortgage interest goes.  The Federal reserve has done an excellent job of balancing growth of the U.S economy and their bond purchasing program has kept demand for Mortgage bonds high and mortgage rates low.  

With the latest poll from the Rasmussen Reports confirming what is happening with prices that we are paying for groceries, consumers are not confident that the Government (the Federal Reserve) won't have success in controlling inflation once the economy gets into full swing again.  If this becomes true , rather than a survey of what American's think MIGHT happen, we will see mortgage rates go up in the future.  

The Federal Reserve will be exiting the bond purchase program in October, 2014-this is their most recent estimate) and with inflation worries, this may be the best and last time to see these mortgage rates at the lows they are currently at (today's rates are the lowest they have been in 15 months). 

The report said that the number of Americans who are paying more for groceries also has risen to its highest level in over two years. There's an increasing lack of confidence, too, that the Federal Reserve Board can keep inflation under control.

A new Rasmussen Reports national telephone survey (95% confidence) finds that 88% of American Adults say they are paying more for groceries this year than the year before. 

This finding is up six points from last month and the highest since May 2012. Only seven percent (7%) say they are not paying more than they were a year ago, the lowest finding since January 2012. Five percent (5%) are not sure. 

American's see this as a great time to sell and buy a home!

Americans now believe it’s a good time to sell a house in their area, and most still consider buying one a good investment.

A new Rasmussen Reports national telephone survey (95% confidence level) finds that 36% of American Adults now say this is a good time for someone in their area to sell a home. That’s down eight points from last month’s high of 44% and back to the level seen in May. 

Still, it remains far more optimistic than Americans have been in most surveys since the spring of 2009. 

With the selling season in full swing this is a great time to consider selling your home and investing in a new home!    

FHA Streamline Refinance-Great way to improve your rate or lower your payment

With mortgage rates at the best they have been for 15 months and the impending exit of the Federal Reserve from purchasing bonds (October, 2014 is the proposed date for tapering the bond purchase program), now may be the best time to consider an FHA streamline refinance.

The Streamline refinance program couldn't be simpler!  There is no appraisal required and the savings in monthly payments can be substantial especially if the current loan has been in existence for 5 years or more.

Information needed to begin to look at FHA streamline refinance options:

• Origination date of current loan
• Payment coupon or online payment information readily available-escrow payment, monthly mortgage insurance amount, balance of loan is on the payment coupon or online screen

Taking advantage of a lower interest rate or monthly payment savings can be something to take a look at to benefit person financial wealth with analysis of mortgage payment and payoff of higher credit card or installment loan debt.  

Also to be considered would be an increase in personal savings rate (into 401k, 403b, growth stock mutual funds, etc) with a decrease in the size of mortgage payments.  

5 Resolutions for First Time Home Buyer's

I love helping first time home buyer's!  The excitement they are experiencing brings back fond memories of my wife's and my first home purchase.  I cherish the opportunity to answer their questions and give them guidance so that their experience can be as pleasant as mine was.

Over the years, I have found that there are 5 resolutions or goals that first time home buyer's can focus on which will help them successfully negotiate their purchase and close on the loan that they want and deserve.

Every borrower has their own set of circumstances which makes their situation unique and I love working out a plan to help them get to the point of loan qualification and they can then move on to their home search.

Because so many first time home buyer's fall into similar circumstances, I have come up with
"The 5 Resolutions for First Time Home Buyer's".

The mortgage world is now rewarding borrower's with better interest rates and more favorable loan programs if they have higher credit scores, so my first advice is to Boost Credit Scores!  I developed a credit monitoring system which has been used by hundreds of my clients to help them fix their credit and to monitor their credit scores.  Here is the link to my Blog Article and at the bottom of the article is the link that takes you out to the credit monitoring companies offering a monthly service:  Credit Monitoring Program

Down payment can open loan program opportunities that will save huge amounts of interest savings over time.  And without a down payment, fortunately, we have great programs available for ZERO down mortgages-Utah Housing Finance Agency, but for the best loan programs, lower cost to originate, and lower interest cost over time,  Save Up to Put Down!

Find The Best Real Estate Agent is the secret sauce to a smooth enjoyable home buying experience! Because my Realtor Business Partners each approach the home buying process the same way as I do and will provide low pressure, educated guidance and assistance through the home buying process (and are experts with first time home buyer's and their questions and needs), I can provide you with a name and phone number of a trusted professional of mine who will amaze you with their abilities.

Beginning a home search usually begins with online searches and a visit to the mortgage calculator also provided online.  Unfortunately, the online mortgage calculators forget (or have no way of providing) information about monthly mortgage insurance (FHA) or private mortgage insurance (Conventional financing) and many assumed mortgage payments are just plain not correct.  The safest way to make sure that you are getting the correct information is to Get Pre-Approved!    My Credit Approval letters are backed up by an Automated Underwriting Decision (Fannie Mae or Freddie Mac) AND I underwrite income and assets.  What this means is that when a client of mine gets an accepted offer, their loan WILL close!  They also KNOW what their future payment is going to be rather than trusting the online calculator.  Pre-Qualify Today!

After meeting with clients, helping them with questions, taking their application (over the phone or in person), getting a credit approval, providing the credit approval letter to their Realtor, they then get to
Find Your Dream Home!  This is the most fun part of the process (still stressful, but fun) and with all 5 Resolutions for First Time Home Buyer's completed, this is a natural final process to a successful journey to home ownership.

Top 5 Spring Maintenance Tips

Spring has arrived!

And that means it’s time for sprucing up the old house. According to Trulia, summer is the hottest season for real estate so if you’re thinking of listing soon, spring is your last chance to make last minute home improvements. If you missed out on winter to do your home repairs, here are a few home maintenance items to tackle as spring puts the spring back in your step.

Check those gutters. The weight of snow, falling branches, and simply cold temperatures can wreak havoc with your home’s gutters. Grab a ladder (and a buddy) and give your gutters the once-over. Check for blockages caused by debris and leaves, make sure seams are firmly held together, and clear the drainage ways as you prep for spring rains. Click this article for additional key maintenance points for any homeowner looking to clean out their gutters.

Clear that chimney. Do you have a home with a chimney? If you live in the Midwest and Midwest, it’s highly likely you do. While the singing chimney sweep from Mary Poppins might not be what you’re looking for, every home needs one this time of year. Have a professional come out and inspect your chimney, especially following all of the use you’ve given it this past winter. They’ll check the mortar, flue, and ensure you’re good to go before the rains make you wish you’d called sooner. If you’re not quite done with use this winter, check out these tips for eco-friendly chimney use.

Inspect outside water connections. Sometimes those hoses don’t make it inside during the winter. Now’s a good time to check your hoses for rips, tears, and breaks, as well as check the spigots coming out of the house for any cold-related damage. This article will take you through de-winterizing your home, complete with visuals. Remember – thawing still-frozen pipes is a delicate process and to avoid damage, pipes are best thawed slowly. We’d all like Mother Nature to step it up a bit, but this is one place where slow and steady wins the race (and saves your wallet).

Tune-up your cooling system. Before the heat of late spring and summer set in, have a professional come give both your central and window air conditioning units a look-see. While you’re waiting for them to arrive to make sure the winter didn’t do a number on your system, go ahead and replace your air filters. And if you’re in a home where there’s no central cooling, check out this new window AC unit from GE/Quirky called the Aros. It’s controlled from an app on your phone and, in addition to the sleek and modern design, claims to save you energy compared to other units of the same power. Might be worth a look.

Review your roof. The most expensive (and most unwelcomed) damage a home can endure is the damage we can’t see. That’s why inspecting your roof each spring is a must. Houselogic has an extensive checklist for seasonal roof inspections, designed to keep you ahead of costly repairs and keep small problems from becoming big ones. The roof over your head has been good to you. Why not be good to it in return by giving it a little post-winter TLC?

How does your credit score measure up?

Home buying made easy with Marty Qualls

I had a great meeting with my Estate Planning Attorney, Jacob Smith, this morning and we talked about the different age groups of clients who we work with.  Just like Jacob, I many times work with the Gen Y or Millennial generation, those in the 19-29 age group.

I commented to Jacob that the Millennials like the fact that they can find you online (web page or blog) and that the information you provide there is easy to find, use and navigate.  I also know that they are the "Do It Youself" generation.  DIY describes how they operate within their everyday lives; they like to research things (Google, Wiki research), weigh out their decisions, not rush into things without considering options and alternatives. 

Even though Millennial's are the home buyer's who most want to easily and smoothly get a credit approval letter into place so that they can go make an offer, get it accepted and close on a loan, I found some interesting information from my research which can sometimes hinder the process of easily getting a credit approval letter: Gen Y has the lowest Average Credit Scores of any of the age groups!

3 Soothing Insights for Anxious First-Time Sellers

How to sell your home successfully!

By Tara-Nicholle Nelson | Broker in San Francisco, CA

I grew up just a couple of hours from Disneyland. So as a kid, one of my greatest joys (and greatest anxieties) revolved around the Pirates of the Caribbean ride (this was pre-Johnny Depp, folks). I loved that ride - especially the big drop at the end - but I also feared that ride, especially the big drop at the end. 

Fast forward a couple of decades and I found myself standing in line for the ride with my own kids, with bated breath and anxious fear/anticipation. We got on and I continued to hold my breath. Just a few minutes later, we sailed gently back to the starting point.

I walked up to an attendant and asked: “When did they take the dip out?” The guy looked at me quizzically and said that the ride’s course had never been changed. The ride didn’t change. But I had - I had grown taller, and so my perspective had shifted. Nothing about the ride was worth even a moment’s anxiety now that I’d grown taller and impervious to the dips and twists and turns.

10 steps to buying a home

Homeownership!

I have a "14 steps to Home ownership" outline which I give to my clients as we meet to complete the signing of their initial application paperwork.  There are 14 steps AFTER your offer to purchase a home gets accepted.

However, I realized that there are "10 steps to buying a home" that would help if you are just BEGINNING the process of purchasing a home.  This list contains important steps in the process  whether you are purchasing your first home, downsizing, or needing a larger home.

If you have further questions or if you would like to get your credit approval letter into place so that you can be a serious negotiator of sales price and asking the seller to pay for your closing costs, call me today and we can get started!

1. Determine your readiness-Are you in a rental or lease agreement, or are you on a month to month agreement?  Do you have money saved for a down payment (there are 100%, ZERO down programs available, call me for details).  Do you know what you qualify for based on your income and debts (this is something I can help with over the phone, call me). 
2. Become an optimal mortgage candidate-If your credit is "young" or you are rebuilding your credit, I have a "Credit Monitoring Program" I can refer you to that is an excellent tool for you to use!  
3. Get a pre-approval letter- My clients receive a FULL Credit Approval letter which is backed by a 3 bureau credit report AND an Automated Underwriting System decision.  This type of Credit Approval is what you need in the Mortgage world that we are currently in.  There can't be any guesswork in the mortgage process, you NEED a credit approval letter to have your loan successfully close! 

7 reasons NOT to payoff your mortgage before you retire

During an application meeting with my clients, whether they are close to retirement or not, I get to a spot where I talk about the conventional wisdom (we hear our parents and grandparents voices in our heads) of paying our mortgage off early. 

In a low interest rate environment I don't advise my clients to prepay their mortgage if:

1. They have credit card, car payment or other debt which has a higher interest rate than their mortgage, or if
2. They have not maxed out their employer matching on their 401k or are not fully contributing to an IRA or Roth IRA.

The article goes on to talk about other reasons that you shouldn't payoff your mortgage:
Forbes Article: 7 reasons not to payoff your mortgage before you retire