Mortgage Time

22 Sep
Fed Meeting and North Korea
Wednesday’s Fed meeting was viewed as mildly negative for mortgage rates. Threats from North Korea on Friday were slightly positive. As a result, mortgage rates ended the week with little change.
For investors, the most notable information from the Fed meeting was that a rapid pace of raising the federal funds rate received support from more Fed officials than expected. Roughly 75% of Fed officials forecasted one more rate hike this year and three rate hikes in 2018. This news caused mortgage rates to rise.
In the years following the financial crisis, the Fed sought to drive longer-term interest rates lower and stimulate the economy by purchasing enormous quantities of Treasury bonds and mortgage-backed securities (MBS). While there is broad agreement that those goals were achieved, the purchases left the Fed with massive holdings of these securities. On Wednesday, the Fed said that it is going to gradually shrink its balance sheet beginning in October. Investors had been expecting this announcement at this meeting, so there was little reaction.
On Friday, North Korea threatened to detonate a hydrogen bomb over the Pacific Ocean. Investors reacted to this by shifting to relatively safer assets, including MBS. The increased demand for MBS caused mortgage rates to decline a little.

In August, single-family housing starts rose from July. The streak of strong readings seen over the last three months may be at risk, however, as the effects of the hurricanes will be seen in coming months. According to the Commerce Department, about 13% of home construction takes place in regions in Texas and Florida that were affected by the recent hurricanes.
Looking ahead, New Home Sales will be released on Tuesday and Pending Home Sales on Wednesday. Durable Orders, an important indicator of economic activity, also will come out on Wednesday. The core PCE price index, the inflation indicator favored by the Fed, will be released on Friday. In addition, there will be Fed speakers every day next week including a speech by Fed Chair Janet Yellen on Tuesday.

>> Read the article online here: http://www.mbsquoteline.com/newsletter/view/278/21342/0/3

The views expressed are my own and do not necessarily reflect the views of my employer.

Visit my website at: www.juliecnichols.com or contact me with any of your home loan questions.

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1031 Exchange = Smart investing!

15 Sep

Sell one investment and purchase up to 3 more with the proceeds while avoiding the capital gains tax! Jeff and Mimi know this is a very smart strategy! We like your style!

The views expressed are my own and do not necessarily reflect the views of my employer.

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Mortgage Time

15 Sep
Hurricane Effects
Early in the week, good news regarding North Korea impacted mortgage rates. The economic data caused little reaction. Mortgage rates ended the week higher, up from the best levels of the year.
In recent weeks, investors have reacted to news about North Korea in the expected fashion. Each time North Korea has conducted a missile test, investors have shifted to relatively safer assets, including mortgage-backed securities (MBS). The added demand has been positive for mortgage rates. As the North Korean government celebrated its 69th anniversary last weekend, many investors had expected another missile test. When this did not occur, investors took the reverse action on Monday. They added riskier assets to their portfolios, which was negative for MBS and mortgage rates. On Friday, however, investors broke from the recent trend and showed surprisingly little reaction to another missile launch.

Two big economic reports released on Friday fell well short of the expected levels. Retail sales in August fell 0.2% from July, below the consensus for a small increase. Auto sales dropped sharply from July, partly due Hurricane Harvey. Estimates of vehicles destroyed by the storm are around 300,000, though, which should boost auto sales in coming months.
Industrial production posted a much bigger miss with a decline of 0.9% from July, well below the consensus for a small increase. However, the Federal Reserve attributed nearly all of the drop to the effects of the hurricane, so there was little market impact.
It is difficult to know what effects the hurricanes will have on economic activity. Some areas will look weak now due to the storms, but the rebuilding efforts will boost activity in the future. As a result, investors likely will not react much to individual reports for some time. Instead, they will look at the results over a longer time frame to try to judge the underlying strength of the economy.
Looking ahead, the next Fed meeting will take place on Wednesday. Investors widely expect the Fed to announce that it will begin to reduce the quantity of Treasury and mortgage securities on its balance sheet. In addition, Housing Starts will be released on Tuesday and Existing Home Sales on Wednesday.

>> Read the newsletter online: http://www.mbsquoteline.com/newsletter/view/277/21342/0/3

The views expressed are my own and do not necessarily reflect the views of my employer.

Visit my website at: www.juliecnichols.com or contact me with any of your home loan questions.

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Equifax breach could be worst in history

15 Sep

Reblogged from Scotsman Guide – Victor Whitman

The hack reported last week by Equifax will go down as one of the worst data breaches in history, and could prove to be the most damaging ever for American consumers, many security experts contend.

Anonymous criminals committed the crime, but cybersecurity experts told Scotsman Guide News that the blame for exposing sensitive information belonging to roughly half of the U.S. population lies with Equifax, which has a history of data breaches.

“I firmly believe they could have prevented this,” said Tim Crosby, a senior security consultant with Austin, Texas-based Spohn Consulting.

Equifax reported last Thursday that it discovered on July 29 that cybercriminals exploited “a U.S. website application vulnerability” to gain access. Equifax determined that as many as 143 million people were compromised.

The information included Social Security numbers, birth dates, addresses and, in some cases, drivers-license information. Also, the credit card numbers of 209,000 U.S. consumers were exposed. Information on consumers residing in the United Kingdom and Canada also was breached.

Equifax believes the attack occurred in mid-May and continued until it was discovered nearly two months later.

“This is a pretty scary thing,” Crosby said. “It is going to affect the other credit reporting agencies, who are going to have to be on their toes. We know somebody has the information. We don’t know how widely it has been distributed, or who got it yet.”

Repeated breaches

Equifax has been breached or admitted to mishandling sensitive consumer information five times since 2005, according to the website privacyrights.org. Most recently it was reported in May 2016 that hackers breached its W-2 Express Website, exposing tax and salary information on 431,000 Kroger employees.

In October 2010, Equifax agreed to pay a $1.6 million fine to settle a complaint with the Federal Trade Commission, after admitting to selling information on people who had been late in paying their mortgages. This affected 17,000 consumers. The company had two other smaller incidents in 2010 and 2006.

“In my opinion, this is the super jackpot of cybersecurity compromise,” said Jeffrey Bernstein, the managing director of Critical Defence. Bernstein doubted that the hackers will ever be caught. They may have already sold the information on a shadowy "dark web," a number of small private networks that can’t be accessed through traditional search engines. Equifax could face severe penalties, Bernstein said.

“This type of breach should never happen,” Bernstein added. “A company like Equifax has a very high-profile, high-threat environment that they operate in. They have a treasure trove of data, of our private data, and they need to protect it.”

Equifax officials were not immediately available for comment.

As of Monday, Equifax had provided no additional information on how cybercriminals accessed its database. Web applications can be any program accessed over a network connection. Typically, a person logs in with a user name and password. Facebook and LinkedIn are two well-known examples of web applications.

Hackers often develop attack tools to exploit vulnerabilities in these programs, engaging in a cat-and-mouse game. Companies, in turn, must constantly test their web applications for vulnerabilities and provide fixes.

>> Read the original article here: http://www.scotsmanguide.com/News/2017/09/Equifax-breach-could-be-worst-in-history/?utm_source=TopNews091517&utm_medium=email&utm_campaign=TopNews

The views expressed are my own and do not necessarily reflect the views of my employer.

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Congratulations Satyen & Reema!

11 Sep

We hope you enjoy your new home! We really enjoyed working with you.

The views expressed are my own and do not necessarily reflect the views of my employer.

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Mortgage Time

8 Sep
Geopolitical Events
An increase in tensions with North Korea was positive for mortgage rates early in the week. Political headlines then caused some volatility later in the week, but the net impact was small. At Thursday’s meeting, the European Central Bank (ECB) essentially postponed a discussion about tapering its bond buying program until its next meeting, so there was little reaction. The net effect was that mortgage rates reached the best levels of the year.
Geopolitical events were the primary influence on mortgage rates over the past week. On Sunday, North Korea conducted its most powerful missile test yet. Once again, the reaction from investors to the increase in tensions was to buy relatively safer assets such as U.S. mortgage-backed securities (MBS). The added demand for MBS caused mortgage rates to decline. Later in the week, mortgage rates rose and then fell based on shifting prospects for a plan to extend the debt ceiling. Increases in uncertainty about the debt ceiling have been good for mortgage rates. Conversely, when signs of progress on a plan have appeared, it has been negative for rates.

The effects of Hurricane Harvey were evident in the latest report on Jobless Claims which is released every Thursday. After holding very steady at levels near 240,000 for the last couple of months, claims jumped to 298,000 this week. This was the highest level since April 2015. It also was the largest weekly increase since 2012.
Looking ahead, the JOLTS report, which measures job openings and labor turnover rates, will be released on Tuesday. The Consumer Price Index (CPI) will come out on Thursday. CPI is a widely followed monthly inflation report that looks at the price change for goods and services which are purchased by consumers. Retail Sales will be released on Friday. Consumer spending accounts for about 70% of economic activity in the U.S., and the retail sales data is a key indicator. In addition, there will be Treasury auctions on Monday, Tuesday, and Wednesday. Headlines about the debt ceiling also could cause volatility in mortgage rates again.

>> Read the newsletter online: http://www.mbsquoteline.com/newsletter/view/276/21342/0/3

The views expressed are my own and do not necessarily reflect the views of my employer.

Visit my website at: www.juliecnichols.com or contact me with any of your home loan questions.

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Another successful Refi

7 Sep

Congrats Kenneth and Angela on your refinance!

The views expressed are my own and do not necessarily reflect the views of my employer.

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Thumbs up to an awesome closing!

29 Aug

Best Wishes in your new home Gary!

The views expressed are my own and do not necessarily reflect the views of my employer.

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Mortgage Time

25 Aug
Volatility from Politics
Political news caused some volatility for mortgage rates this week, but the net effect was small. There was little reaction to the economic data or to Friday’s highly anticipated speech by Fed Chair Janet Yellen. Her speech did not include comments about monetary policy. Mortgage rates ended the week slightly lower, at the best levels of the year.
Faster economic growth raises the outlook for future inflation, which is negative for mortgage rates, while slower growth has the opposite effect. On Tuesday, investors were surprised to hear reports that the Trump administration and key Republicans in Congress had made progress on tax reform. Since a tax reform package is expected to be pro-growth, mortgage rates rose after the news. However, remarks from President Trump about possibly ending the NAFTA trade agreement caused a reversal on Wednesday. Mortgage rates moved lower because most investors think that ending NAFTA would slow economic growth.

The housing data released this week revealed that a shortage of inventory remains a headwind for home sales. In July, sales of previously owned homes decreased a little from June to the lowest level since August 2016. Total inventory of homes for sale fell to a 4.2-month supply, and it was 9% lower than a year ago.
New home sales, which are more volatile month to month, dropped 9% from June. On the positive side, the June results for new home sales were revised higher.
Looking ahead, the important monthly Employment report will be released on Friday. As usual, this data on the number of jobs, the unemployment rate, and wage inflation will be the most highly anticipated economic data of the month. Before that, the first revision to second quarter GDP will come out on Wednesday. The Core PCE price index, the inflation indicator favored by the Fed, will be released on Thursday. The ISM national manufacturing index will come out on Friday. In addition, there will be Treasury auctions on Monday and Tuesday.

>> Read the newsletter online: http://www.mbsquoteline.com/newsletter/view/274/21342/0/3

The views expressed are my own and do not necessarily reflect the views of my employer.

Visit my website at: www.juliecnichols.com or contact me with any of your home loan questions.

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Mortgage Time

18 Aug
Data, Fed, Politics
Uncertainty surrounding the Trump administration and dovish Fed minutes were positive for mortgage rates this week. Stronger than expected economic data had the opposite effect. While it was a fairly volatile week, the net result of these influences was that mortgage rates ended the week with little change, remaining near the best levels of the year.

After several months of surprisingly weak reports on retail sales, the data released on Tuesday was encouraging. Excluding the volatile auto component, retail sales in July surged 0.5% from June, which was well above the expected gains. In addition, the results for June were revised significantly higher.
Since retail sales are a critical part of the economy, this month’s strong results were viewed as a positive sign for future economic growth, but also a contributor to rising inflation. This caused a negative reaction in mortgage rates.
It appears from the Fed minutes released on Wednesday that there is a growing split between Fed officials about when inflation will begin to rise. A growing number of officials would like to move slowly to raise the federal funds rate any further. They argued that the Fed "could afford to be patient under current circumstances." The more dovish tone of the minutes was favorable for mortgage rates.
President Trump’s comments this week about the events in Charlottesville drew widespread condemnation. Apparent loss of support from political allies and business leaders and the rumored resignation of a key advisor sparked a stock market selloff late in the week. The chance that pro-growth legislation will pass any time soon is believed to have diminished. While this was bad for stocks, it was good for mortgage rates because expectations for future inflation also declined.
Looking ahead, investors will be watching for further developments regarding the Trump administration. It will be a light week for economic data. New Home Sales will be released on Wednesday and Existing Home Sales on Thursday. Durable Orders, an important indicator of economic activity, will come out on Friday. In addition, global central bankers will be attending the annual Jackson Hole conference Thursday through Saturday, and any comments about future monetary policy could affect mortgage rates.

>> Read the newsletter online: http://www.mbsquoteline.com/newsletter/view/273/21342/0/3

The views expressed are my own and do not necessarily reflect the views of my employer.

Visit my website at: www.juliecnichols.com or contact me with any of your home loan questions.

#MortgageBlog, #BestMortgageLender, #GMFS, #JulieNichols, #NicholsTeam, #ChangingLives