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If you’ve seen the news lately, you know concerns about inflation are increasing. But what does it really mean to you?  The fact is, inflation is a very serious issue, and it will likely be on the rise as 2009 proceeds…and along with it, home loan rates will rise too.  To help you learn more about this important topic, I want to send you a link to a short video, featuring the nation’s foremost mortgage industry expert.

In this video, you’ll learn how inflation impacts interest rates and what the outlook is for down the road.  Because home loan rates will be on the rise, if you or any of your family, friends, neighbors or co-workers have been considering a purchase or refinance, now’s the time to act.  Please contact me today to discuss your specific situation, and feel free to forward this email and video link along to others that you think might benefit from it as well.

Watch the Video

Sincerely and respectfully,

Daniel A. Sosa

PMZ Mortgage Consultant

Office: 209-472-2010 x4716

Cell: 209-298-8017

Email: dsosa@pmzloans.com

Website: www.loanapproval411.com

Financial advice is rarely one-size-fits-all, but this interview with Suze Orman is worth a watch.  In 5 minutes with NBC’s The Today Show, Ms. Orman covers a ton of relevant ground for homeowners and the public-at-large:

• Who should — and shouldn’t — be paying down their mortgage
• What backlash to expect from the Dow’s 40% run-up since March
• Why July 2009 is so different of an environment from July 2008

Then, as a bonus, Orman explains the relationship between bond prices to bond yields. It’s the heart of why mortgage rates rise when inflation is present.  A lot of what Orman talks about is spot-on, but that doesn’t necessarily make it appropriate for your individual situation. Before acting on Orman’s opinions, talk to your financial professional first….

To watch this streamline video, please visit:

http://www.loanapproval411.com/info_01/page_1.rad

Sincerely and respectfully,

Daniel A. Sosa

PMZ Mortgage Consultant

Office: 209-472-2010 x4716

Cell: 209-298-8017

Email: dsosa@pmzloans.com

Website: www.loanapproval411.com

After starting the week with a run lower toward 5 percent, mortgage rates have reversed course.   It started mid-day Tuesday and the culprit is Basic Economics.  Here’s why.  Mortgage rates are based on the price of mortgage-backed bonds and — like most things — mortgage-backed bonds prices are based in Supply and Demand. 

When bond supplies grow faster than the corresponding demand for them, bond prices tend to fall and when bond prices are down, bond yields are up.  Meanwhile, this week, the U.S. Treasury is making its largest weekly auction in history.  $115 billion in new debt, to be exact.  This means that before the week is through, $115 billion in new bond supply will have been introduced into the market and — so far — demand hasn’t kept pace with the new supply…

To read the rest of this mortgage industry blog, visit:

http://www.loanapproval411.com/info_01/page_1.rad

Sincerely and respectfully,

Daniel A. Sosa

PMZ Mortgage Consultant

Office: 209-472-2010 x4716

Cell: 209-298-8017

Email: dsosa@pmzloans.com

Website: www.loanapproval411.com

Once again, the housing market is showing that its worst days may be over.  According to the Census Bureau, the number of new homes sold in June leapt by 11 percent from the month prior.  It stands as the biggest one-month jump in 8 years.  A “new home sale” is when a home in any stage of construction — not yet started, under construction, or already completed — goes under contract, often with a builder.  It’s the opposite of an “existing home sale”.

In addition to surging sales, the monthly supply of new homes fell to its lowest level in 11 years.  Because home values are based on the relative supply and demand for a particular home in a particular area, anytime that demand for homes grows faster than supply, we would expect prices to rise.   Indeed, that’s what we’ve been seeing. 

The combination of low interest rates, seller-paid incentives and a first-time home buyer tax credit is bringing buyers into the market faster than new supply can come online.  It’s one reason why home prices have stopped falling across many parts of the country.  It’s also why home buyers may find it tougher to get “a good deal” in real estate later this year and into 2010.  If demand stays high and supplies fall further, sellers should regain the upper-hand in contract negotiations.

Sincerely and respectfully,

Daniel A. Sosa

PMZ Mortgage Consultant

Office: 209-472-2010 x4716

Cell: 209-298-8017

Email: dsosa@pmzloans.com

Website: www.loanapproval411.com

Home values around the country appear to be leveling.  The Federal Housing Finance Agency’s latest Home Price Index report shows values up by nearly 1 percent in May versus the month prior.  Since peaking in April 2007, values remain off by 11 percent nationwide.

The FHFA Home Price Index is an interesting metric.  Different from the Case-Shiller Index which collects data from just 20 U.S. markets, the Home Price Index reflects every U.S. home that backs a mortgage sold to Fannie Mae and Freddie Mac.  In this sense, the FHFA Home Price Index is more “national” than the Case-Shiller Index but the HPI has its flaws, too. 

The House Price Index specifically excludes from its measurements the sales price on any home purchase with any of following traits:

1. Is new home construction
2. Is a multi-unit property
3. Is financed by an entity other than Fannie Mae or Freddie Mac

Because of these exclusions, some analysts say the report is incomplete.  The same could be said of every method of home valuation, however.   Therefore, what’s most important to today’s home buyers and sellers is that each of the “popular” home valuation reports shows similar patterns.  Home prices appear to have stopped falling and may be even starting to recover.

It won’t be for a few years that we’ll be able to look back and point to the exact month that real estate bottomed. Nevertheless, considering how the data has presented as of late, it’s reasonable to think that we’ve already hit it.  Certainly, that’s what the Home Price Index suggests.  For a region-by-region breakdown of the Home Price Index, visit the FHFA website.

Sincerely and respectfully,

Daniel A. Sosa

PMZ Mortgage Consultant

Office: 209-472-2010 x4716

Cell: 209-298-8017

Email: dsosa@pmzloans.com

Website: www.loanapproval411.com