MortgageStraightTalk.com

THE WEEK IN REVIEW

8/4-8/10

Last Friday

The U.S. job market continued its cooldown adding just 187,000 jobs last month, It was less than the 200,000 positions expected. The labor market is still resilient, experiencing 31 straight months of growth. The unemployment rate sank to 3.5 percent, a near record low. Fed officials have been hoping their aggressive rate-hiking campaign would bring about a slowdown in the job market—especially in wage gains, which are viewed as a contributor to inflation. As a result, mortgage rates climbed to the highest levels of the year.

Monday

Stocks rebounded from a rough start in August in the wake of data showing continued cooling in the labor market.

Tuesday

Stocks came under pressure after a warning about US bank health and surprisingly weak Chinese trade data sent shivers through markets. Moody's downgraded 10 small and midsize institutions, which came with a warning it could lower credit ratings for some of the nation's biggest lenders.

Wednesday

The average U.S. 30-year mortgage rate jumped to a nine-month peak on Wednesday and hit the second-highest rate since 2001, as interest rates reacted sharply to a downgrading of U.S. government debt. The average 30-year mortgage rate shot up to 7.09% for the week ending Aug. 4, a 16 basis point increase from the previous week's 6.93% rate, according to a weekly report released by the Mortgage Bankers Association. Rates have not been that high since November 2022, which were then the highest levels since 2001.

Thursday

The Consumer Price Index rose 3.2% for the year through July, up from June’s 3% annual increase. The annual headline rate’s increase was largely due to year-over-year comparisons to July 2022 when monthly inflation turned negative.

The 30-year fixed-rate mortgage averaged 6.96% in the week ending August 10, up from 6.90% the week before, according to data from Freddie Mac released Thursday. A year ago, the 30-year fixed-rate was 5.22%.


IMPACT ON MORTGAGE RATES

The biggest consideration for mortgage rates right now is the progress in the battle to tame inflation. The latest major inflation data was right in line with expectations, however, leaving investors to focus on Japanese monetary policy and U.S. government spending. These secondary influences were negative for mortgage rates, which ended the week a little higher.

A PERSONAL ANECDOTE

I rarely get ill—haven’t had a cold or flu in a decade or more, but then again, I typically get the doctor recommended flu shot every fall.

Monday, I couldn’t stop coughing, that night I went to bed early and alternated between sweating and shakingly cold shivers along with some joint and muscle aches. I felt as weak as a baby.

Tuesday, I started feeling better, but my nose was running like a faucet. But some of my strength seemed to be returning.

Wednesday, my lungs felt like they were irritated from rubbing against my ribs due to the day & night coughing—at least that’s what I surmised. The top of my skull felt like it was about to lift off each time I had to cough. I called my doctor and requested that he send a scrip to the pharmacy for antibiotics. His front office girl said their protocols required that I be tested for Covid before the doctor would write me a scrip.

“C’mon. I’ve had the vaccine and 4 booster shots.”

“Sorry, but these are our protocols.”

“Okay, how soon can you get me in?

“Can you come over now?” she replied.

“Be there in 20.”

“Oh, one last thing, don’t come in the building, sit outside on the bench and then let us know you have arrived”

“How am I supposed to do that, yell through the window?”

“No, use your cell phone.”

As I said, I thought it was a waste of time but I wanted scrip for the antibiotics. Upon arriving I called the doctor’s number and of course these days you have to go through the usual “If this is an emergency, dial 911” plus all the additional phone trees of voice mails. After 5 minutes of this nonsense, a woman came on the line and I told her that I was outside on the bench. A few minutes afterward, a nurse garbed in a haz/mat suit, face shield and face mask appeared. After swabbing one nostril she disappeared. About 15 minutes later she returned and informed me that I had tested positive I said, “ Well, so much for all those shots.” She corrected me and told me that the vaccine didn’t keep you from getting Covid, but it keeps you from dying from being hospitalized or dying from it. So, I left the doctor’s office and drove to the pharmacy and got my prescription for PAX-LOVID.

By Thursday evening I had had 3 doses of PAX-LOVID over the past 36-hours. I was still coughing, but much less so than in previous days. My general feeling of well-being is returning.

Just goes to show you we’re not out of the woods with this virus, yet.


This Week’s Featured Loan Program: UNCOMMON LOANS

These are loans for which there is relatively little demand, but if you or your client need one, it’s nice to know that they exist.

USDA RURAL (for out of town properties)
*FICO MINIMUM OF 580
*29/41% DTI ratios
*30 yr. fixed available
*Sub-prime available down to 600 FICO
*30 yr. fixed @ 6.000%

Manufactured Housing (prefab and modular, NOT mobile homes)
*10, 15, 20, 25 & 30 yr. fixed rate terms available
*Conventional, FHA & VA programs
*Max. LTV: 100% with VAs and 96.5% with FHAs
*Conforming 30 yr. fixed @ 6.375%
*Conforming 15 yr. fixed @ 5.875%
*FHA 30 yr. fixed @ 5.990%
*FHA 15 yr. fixed @ 6.125%
*VA 30 yr. fixed @ 6.125%
*VA 15 yr. fixed @ 6.125%

Foreign Nationals
*15 & 30 yr. fixed terms available
*Adjustable-rate programs also available
*Eligible properties include SFRs, condos, 2nd homes and 2-4 units
*Max LTV is 75%
*Debt-to-income ratios up to 55%
*5/6 ARM @ 7.750%
*7/6 ARM @ 7.750%
*10/6 ARM @ 7.785%
*15 yr. fixed @ 7.625%
*30 yr. fixed @ 7.750%

ROD HAASE

"I SELL MONEY AND SERVICE"

cell: 760-717-8584
office: 760-726-4600
fax: 760-730-5692

[email protected]
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