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The growth, it appears, will be in interest rates.
And before Spring, I should imagine.
I picked up some more TBT today. Prospective homebuyers may want to think about locking in their rates, should they choose to go the mortgage route.
Gold and silver and many other commodities seem to be indicating we are witnessing yet another inevitable result of the abused dollar. I think treasuries yields are about to give up the same ghost, no matter what Mr. Bernanke has planned for them…
Forgive me for my peevishness as of late. I completed a large opus today, the stress from which I am perhaps allowing to leak out from my very pores and upon these pages.
Now, I must rest.
My best to you all.
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Yes, just locked in a 15-year mortgage at 4 percent.
Unbelievable savings, compared to the one I had, a 30-year, 6.875 percent deal from August 2006.
The mortgage broker thought maybe the rates might go down another one-quarter percent, nothing worth holding out for, really.
Still, he said, not many people who really need the refis at these astounding low rates can qualify.
Yes, that’s the rub — they’ve gotten about 10,000% more stringent about qualifying these days.
Closing the old barn door after the leperous stallion has left the stable, I’m afraid.
DMG is a mortgage guy, and I was going to ask him if he could do any better than the 3.75% on a ten year I’ve seen. Given deductability, etc, that’s some damn cheap 10-year financing.
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Jake,
I’m on capital markets side of mortgage world so I have some insight. 3.75% for 10/15year is close the the very low end you are likely to see. There are currently a lot of capacity constraints in the mortgage process (at both originator level and investor) and pricing is one of the ways we use to control the origination of new loans. Depending on the mortgage originator you are looking at, there might be a significant margin pad for the loan. There are a few folks out there that have very slim margins.
Let me know if you have any other Q’s.
I’m on capital markets side of mortgage world so I have some insight…
Buuuuuuuurn ‘im!!
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All seriousness, what’s it feel like to be blamed for “all of this” (gesturing towards the whole busted economy)?
I know it wasn’t really you, but it still must make Thanksgiving dinner with your bearded hippy uncle Roy interesting, no?
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Looks like my longer reply is awaiting moderation. Uncle Roy sometimes gets turkey stuck in his beard…
Jake,
Well played. Fortunately for me my views are closer to bearded hippy uncle Roy than Angillo ‘Tan Man’ Mozillo. I’ve worked for subprime credit card companies and that was the only time I felt slimy going to work. I work for a small mortgage bank hedging the pipeline and handling loan sale execution. We originate and sell to the likes of WF, Chase, BoA aka ‘the deathstar’ (at least the Countrywide part), GMAC, etc. During the scummy years we were pretty conservative with subprime and liar loans. Yes I sold some pick a pay option type arms for ridiculous premiums, but we were very slow to even add this program to product line up. It wasn’t until all the insomniac borrowers who had suddenly watched an infomercial and had aspirations of becoming the next Donald Trump started requesting the ‘cash flow loan’ that we looked at adding.
The one thing I wish folks would understand about the mortgage crisis was where it started…. surprise surprise… Wall St. We had every major IBank trying to get us to originate subprime loans and loosen our guidelines. A few even bought the pick a pay loans in pools. There goal was to get as many loans as possible and realized that opening up guidelines would feed the securitization machine faster. Our subprime was really considered ALT-B, and we made it clear that we didn’t want to originate the really dirty loans, but that didn’t stop them from asking.
The other area of blame should be on the consumers. Most didn’t care or want to understand how the loan worked that they were signing for. All they knew was that the guy on TV and their rich uncle Pancho or Joe or Ming were able to become mini moguls with these loans and they wanted the gaudy gold chain and oversized SUV with chrome 22″ rims and frequent trips to Sin City that came with being a landlord. The cycle was akin to a drug dealer and junkie relationship. Wall street provided the financing and the consumers were able to ‘live large’. Personal responsibility was and still is lacking and I think it is very unfortunate.
Being a renter and never owning a house I’m ready for my bailout. Maybe the govt should start paying people for paying their bills on time. Heck, instead of blowing the money, I might just use it for more education and try to add something to society.
Duck– again, my apologies for all this getting caught in the spam filter, but we’ve had some pretty bad spam action recently, so I think Jeremy may have tightened the parameters a bit. This is all good stuff…
Your indictment of Wall Street guys wanting to do deals is probably correct, but the one thing you leave out here is what gave them free reign to include all this bad paper in their securitzations. It was the dual role of the “get everyone in a house gov’t” and the “Fannie and Freddie can do no wrong” gov’t that backstopped all this schit, and allowed for the moral hazard that blew this bubble up.
Not making excuses for Wall Street, but traders are going to exploit opportunities if they are created….
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Jake,
No worries on the spam. Glad the issues are contained.
I agree with govt creating an environment that allowed it to happen. Everyone involved failed the moral hazard test. Govt, wall street, main street, mortgage brokers, real estate brokers, appraisers, ratings companies, etc
I wish I didn’t have a moral compass and could have lived larger than my paycheck.
Well, think of it this way — at least it kept you out of sharing a cell with T’angelo Mozzillo!
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Duck — sorry, I will rescue it when I get home. cannot do it from the mobile.
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Brilliant Movie……
For Jake:
http://www.ritholtz.com/blog/2010/08/i-love-gold/
That little fella shoulda brought the feisty Leprechaun with him to give that Banker a beatdown!
Thanks goodness there is someone who has seen this movie… I was starting to get exasperated by the lack of reaction.
Seller’s greatest, and only months before he kicked the bucket. His magnum opus.
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LOL… that shit is hilarious. Nice copy on the iPhone cartoon, but my shiny golden metal is a tad more fungible than that Steve Jobs carny art.
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Just quoted a friend 4.375% w/ 0 points on a 30 yr fix conforming jumbo (between $417,001 – $536,000 in my area)… strong coffee
Do you agree there’s no beating 10 year @ 3.75?
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I’d lock it up
Disagree on your rising rates thesis. You can call it another brick in the wall but my only interest in trading is being correct on trend, the following is worth a read:
http://brucekrasting.blogspot.com/2010/08/another-mans-opinion.html
Jake,
If spot gold approaches 1260, am I correct in thinking that we should lighten up on everything?
In any case, will you be advising us when things start to look shaky?
I think it’s likely we’ll see a pullback there, but I wouldn’t be surprised if it’s a bit north of there (ie, “new highs”).
I will likely be selling some calls there… briefly!
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