Monday ended up being rather uneventful for the bond despite its role as the lead-off hitter for an all-star line-up. There were no significant economic reports on tap, but the 3yr Treasury auction managed to come in weak enough to prompt a bit of additional selling. Losses were short-lived and trading levels returned to pre-auction levels about 90 minutes later. That left a sideways-to-modestly-weaker tone intact for the day as traders wait for ultra-high consequence data and events on Wednesday.
09:58 AM
modestly weaker overnight and little-changed since then. MBS down 3 ticks (.09) and 10yr up 1.5bps at 4.476
01:40 PM
a bit weaker after 3yr Treasury auction. 10yr up 2.8bps in total on the day at 4.489. MBS are down an eighth of a point in 6.0 coupons
03:20 PM
Recovering some of the post-auction weakness now. MBS down 3 ticks (.09) and 10yr up 1.9bps at 4.48
Download our mobile app to get alerts for MBS Commentary and streaming MBS and Treasury prices.
Series EE bonds, or Patriot Bonds, were initiated in 1980 as a low-risk way for Americans to save. The money invested is guaranteed to double in 20 years.
They build upon the tradition of Series E bonds, or war bonds, which were introduced by the federal government in 1941. Learn more about this savings vehicle here.
What Is a Series EE Bond?
A series EE bond is a U.S. Treasury bond. It’s considered to be a very safe investment, as it’s backed by the U.S. government. It is guaranteed to double in value in 20 years, even if the government has to add funds to it to meet that mark.
To provide some context, here’s a quick look at what bonds are and how bonds work. A bond is a debt instrument. Bonds are issued by corporations or governments in order to raise capital. The bond market is huge — much larger than the equity markets. (In 2023, the market cap of the global bond market was about $133 trillion, versus $111 trillion for the stock market.) Investors provide capital to companies and governments when they buy the bonds, effectively loaning their money to that institution.
Meanwhile, the bond issuer agrees to pay investors the capital back, along with interest, after a certain period.
There are different kinds of bonds investors can purchase, including municipal, corporate, high-yield bonds, and U.S. Treasuries. A savings bond is a type of U.S. Treasury bond, issued with the full faith and credit of the U.S. government, meaning there’s virtually no chance of losing money. Savings bonds allow the government to borrow money for various purposes while giving investors a reliable and predictable stream of interest income.
Series E bonds, which were created in 1941 to help fund the WWII effort, were replaced in 1980 with Series EE bonds, or Patriot Bonds.
💡 Quick Tip: An online bank account with SoFi can help your money earn more — up to 4.60% APY, with no minimum balance required.
How Do Series EE Bonds Work?
If you’re interested in buying bonds, here are details on how a Series EE bond works:
• Series EE bonds are electronic and can only be purchased and managed online with a TreasuryDirect account. They are available in any denomination starting at $25, up to $10,000 per person named on the bond, per calendar year.
• These bonds are guaranteed to double in value in 20 years, even if the government needs to kick in extra cash. You can hold the bond for up to 10 additional years to continue to earn interest.
• When you purchase a Series EE bond, the interest rate will be stated. Through October 31, 2024, the interest rate is 2.70%.
• Interest is earned monthly, compounding semi-annually, for up to 30 years, unless you cash it sooner.
• Series EE bonds can be cashed in (or redeemed) after 12 months, but early withdrawal can trigger a penalty of partial interest loss.
• Electronic Series EE bonds can be cashed in via the TreasuryDirect site.
• Interest earned on Series EE bonds is taxable at the federal level. Federal estate, gift, and excise taxes, as well as state estate or inheritance taxes, may also apply. If the money is used for qualified education expenses, however, you may not be subject to taxes.
• The TreasuryDirect site also makes 1099-INT statements of interest earnings available annually.
Recommended: Understanding the Yield to Maturity (YTM) Formula
Understanding Series E Bonds
The popularity of Series E bonds may have hinged largely on the patriotic call to purchase them as part of the war effort. Buying bonds served two purposes: It helped the government to raise money for the war and it also helped to keep inflation at bay as shortages threatened to push consumer prices up. Apart from that, there were other qualities that might have made a Series E saving bond attractive.
These bonds were issued at 75% of their face value and returned 2.9% interest, compounded semiannually if held to 10-year maturity. So investors were able to earn a decent rate of return on their investment.
Series E bonds were also affordable, with initial denominations ranging from $25 to $1,000. Larger denominations of $5,000 and $10,000 were added later, along with two smaller memorial denominations of $75 and $200 to commemorate the deaths of President Kennedy and President Roosevelt, respectively.
Series E bonds were redeemable at any time after two months following the date of issue. Bond purchasers could redeem them for the full face value, along with any interest earned.
Interest from Series E bonds was taxable at the federal level but exempt from state and local taxes, adding to their appeal. And because they were issued by the federal government, they were considered a safe investment.
Recommended: Understanding the Yield to Maturity (YTM) Formula
Series EE Bond Maturity Rate
The maturity rate for EE bonds depends on when they were first issued.
Here’s a table showing the maturity dates for Series EE bonds over time:
Issuing Date
Maturity Period
January – October 1980
11 years
November 1980 – April 1981
9 years
May 1981 – October 1982
8 years
November 1982 – October 1986
10 years
November 1986 – February 1993
12 years
March 1993 – April 1995
18 years
May 1995 – May 2003
17 years
After June 2003
20 years
Recommended: 13 Tips for Aggressively Saving Money
Are Series EE Bonds Right for Me?
Series EE bonds can be a convenient, low-risk way to help your money grow over time. Plus, many people like the idea of investing in America and having their investment backed by the U.S. government. However, the rate of return may not be optimal, and the bonds are typically held for quite a long time versus a short-term investment.
Here are two popular alternatives you might consider to grow your money:
Savings Accounts
A savings account is a deposit account that’s designed to hold the money you don’t plan to spend right away. You can find various types of savings accounts at traditional banks, credit unions, and online banks. Savings accounts can pay interest, though not all at the same rate.
High-yield savings accounts at online banks, for example, tend to pay much higher rates than basic savings accounts at brick-and-mortar banks. Currently, they may offer around 4.60% APY (annual percentage yield) versus 0.58% for savings accounts.
Stocks
If you’re unclear about how stocks work, they effectively represent an ownership share in a company. When you buy shares of stock, you’re buying an ownership stake in a publicly traded company. The way you make money with stock investing is by buying low and selling high. In other words, you want to purchase stocks at one price then sell them for a higher price.
Stock trading can be a more powerful way to build wealth over time versus keeping money in a savings account or buying bonds. But there’s a tradeoff since stocks tend to be much riskier than bonds or savings accounts. Buying shares of mutual funds or exchange-traded funds (ETFs), which hold a collection of different stocks as well as bonds, is one strategy for managing that risk.
Recommended: Bonds vs. CDs: What’s Smart for Your Money?
Banking With SoFi
Series EE savings bonds can be a safe way to earn a steady rate of return. However, they aren’t the only way to grow your money.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.
FAQ
When should I cash in EE savings bonds?
Series EE savings bonds are optimally held for 20 years, at which point the money invested will have doubled. If you’d like to keep earning interest, you may hold the bonds for up to an additional 10 years.
How long does it take for a Series EE savings bond to mature?
Series EE savings bonds mature in 20 years. At the end of that period, the initial investment’s value will have doubled. You may hold them an additional 10 years and continue to earn interest, if you like.
Do Series EE savings bonds double after 20 years? 30 years?
Series EE savings bonds double after 20 years. If you don’t redeem them, you may continue to earn interest on them for another 10 years, for a total of 30 years.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
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Inside: The 100 Envelope Challenge is a popular money saving challenge that has gained widespread popularity in recent years. The envelope money challenge is a fun and creative way to save money as it can be tailored to suit different budgets and financial goals.
Let’s be honest… sometimes you just have to make saving fun because saving money for another day can get kind of boring after a while.
Here at our site, Money Bliss, we have plenty of fun money saving challenges to help you find the perfect one for you.
Today, we are going to bring you one that is very unique.
Have you seen the popularity of this money saving challenge with envelopes taken off on TikTok? If not, then you are missing out.
This saving hack has been going viral and does not seem to be going away anytime soon. There is so much interest in this information!!
In this article, we will break down everything you need to know to start saving money today.
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
What is the 100 Envelope Challenge?
The 100 day envelope challenge is a straightforward hack to start saving money.
You start with 100 envelopes and label them with the numbers 1 through 100. Then place all of the envelopes in a special place like a container box, basket, file folder, or bag.
Each day, you will choose a new envelope, and you must put that amount of money in the envelope.
Real Life Example For With 100 Day Envelope Challenge
For example, if you draw the number 33, then you would put $33 into that envelope and seal it.
Then the next day, if you draw the number 72, you would put $72 into that envelope and seal it. Then, continue this challenge for over 100 days.
And the best part is by the end of the 100 envelope challenge, the goal is to save $5,050.
Now, after 100 days, I would call saving $5,000 a huge win. Now, do I have your interest?
Is the 100 envelope Challenge worth it? My Personal Experience
I recently started the 100 day envelope challenge because I wanted to save more money. This was a great way to kickstart my short term goal.
My kids loved to pull out the envelope for that day and stuff it with cash. Once I was done I would close the envelope and stamp it with a sticker.
As a very visual person, I found that this challenge was incredibly rewarding and gave me a sense of accomplishment.
I was able to see my progress as I went along, and it was nice to have a visual reminder of how far I had come.
I was also able to stay on track with my saving goals and could adjust if needed.
On the downside, we don’t have cash around as much.
So this was the hardest part of the envelope saving method. Consequently, I opened a separate savings account, and I could easily make a transfer from my checking account. This allowed me to stay on top of my savings without worrying about having enough cash.
When I was a waitress, this challenge would have been a fun way to save money with my tips! Oh, what an inspiring money-saving journey that would have been!
100 Envelope Challenge Chart
How much money do you save with the 100 envelope saving challenge?
You need to the numbers behind everything so you truly understand how the 100 day money challenge is set up.
Let’s break down how the math works with this 100 envelope challenge chart. See the image below for a visual layout of the information.
At the end of the 100 day money challenge, you will save $5,050!!
How the 100 day Envelope Savings Challenge Works:
This is how to do the 100 envelope challenge. The premise of the 1-100 day envelope saving challenge is simple.
The 100 day envelope challenge is a savings challenge in which you are challenged to save a specified amount of money within 100 days.
Step #1 – Gather your supplies
Step #2 – You will write the numbers 1-100 on blank envelopes.
Step #3 – Each day or whenever you choose to pick an envelope, you will stuff the envelope with that much cash.
Step #4 – Track your progress.
Step #5 – Save $5050 in 100 days or 100 envelopes.
Pretty easy, right?
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
Envelope Challenge Math
Are you a little worried about having to save a lot in one week? Need to know how to calculate 100 envelope challenge, here you go.
Here is the math if you randomly pick an envelope each day:
Most you save in one week: $679
The least you save in one week: $371
Even if you do not finish the entire 100 days and quit on day 50, you will save at least $950. More than likely, it will be a higher amount (unless you are great at just picking numbers under $50).
This challenge is great for somebody who gets paid with cash consistently, like servers, bartenders, drivers, caddies, etc – any tipped employee.
Find more money saving charts.
Is the 100 envelope challenge hard?
In fact, the 100 envelope challenge is extremely simple – just number the envelopes and shake them around to randomize their order.
You can use this method to save for anything – a vacation, a new car, or even your retirement!
This is a great way to exercise your brain and challenge yourself.
Raisin
Simply select one of the high-yield savings products offered by their network of federally insured banks and credit unions to begin your savings journey.
You can open a free Raisin account in just a few minutes!
Compare Rates
Advantages of 1-100 Envelope Challenge
Most importantly, the 100 envelope challenge is a great way to save money.
This 1-100 saving plan is simple and easy to follow. You can save a lot of money in a short period of time with this challenge.
1 – Save Money for a Purpose
The challenge is a great way to save for your emergency savings, pay off your debt, or save for a vacation.
You can start the challenge at any time and with any amount of money. All you need is 100 envelopes and some willpower!
2- Makes Savings A Habit
One of the advantages of building good habits is that they become easier and more automatic with time – this is proven by my favorite book, Atomic Habits.
Habits are a helpful thing, as they can make our lives a lot easier. When we build good habits, we’re more likely to do the same things in the future without having to think about them.
That is why the 100 envelope challenge is amazing. With each envelope, you are building a habit of saving money and paying yourself first.
3- Improve your Cash Situation in 3 Months!
This challenge helps you save money in a short period of time.
For 100 days (or envelopes), you are focused on saving money. A little bit at a time.
Also, it helps you become more mindful of your spending. That is a win-win!
In fact, you can use this how to save 5000 in 3 months chart.
4 – Easy to Follow with No Excuses
No advanced math skills are needed for this one.
The plan is simple to follow and the cash is easy to access.
As such, it would be difficult to come up with reasons why you are unable to complete this 100 day money envelope challenge.
5 – Restart if needed
Too many times, one thing happens and it completely derails our plans.
If your financial situation changes, you can stop and restart the challenge when you can. This makes it a great option for people who want to save money but are nervous if their finances change.
Drawbacks of the 100 Day Money Challenge
There are a few drawbacks, just like there are with any money saving challenge.
1 – Access to Cash
The first one is if you do not have access to cash readily. This can cause a problem to stuff your numbered envelopes with a dollar each day.
If you manage your finances digitally and don’t carry various dollar bills around, then it is much harder for you to find ways to actually physically stuff those envelopes with cash.
2- Figuring out the Budget with High Number Days
Another drawback of the challenge is what would happen if you picked #98 and # 99 on back-to-back days, you must save $197. That may be a challenge to have the extra cash available to do so. Especially if you pick #97 on day 3!
For instance, even for a tipped employee as a server who maybe makes $160 in a shift. That means over half of their cash would have to go straight to the envelope challenge.
Change to 200 Envelope Challenge – A Spin to Save at Least $5K!
3 – Concept of Finding Money to Save
Another drawback of this challenge is if you are struggling to live paycheck to paycheck, then attempting this challenge may just get you down and defeated. There is a possibility you may get behind on stuffing the envelopes, as you would randomly pick them.
Instead of being disappointed, you need to change the frequency of picking up an envelope every day to maybe picking envelopes one to three times a week; thus, stretching out the 100 days further.
100 Envelope Savings Challenge will Be Helpful
Even if you only make it, thirty percent of the way through the challenge… guess what, you have 30% more saved now than you did without doing the challenge.
Overall, I truly believe that any way to make saving money fun is well worth the effort.
If you make it to 65% of the way, then you are saving more than you would without the challenge.
How does envelope savings work?
With any of the envelope challenges, they are just a money saving challenge. A fun way to save money! A plan to follow to keep you accountable. A target to achieve!
Envelope savings is a tried and true way to save money.
It’s simple, it’s straightforward, and it works. You put your money in an envelope and don’t spend it until the challenge is complete. This challenge can be a fun way to get to know your spending habits better while saving money.
The savings are real, and you will be surprised at how much you can save by following this challenge for even just a few months!
Plus if you put the money in a high interest saving account, then you are adding more interest and dollars on top!
Many people prefer one of these challenges instead:
Shop for Supplies Needed for the 100 Day Envelope Money Saving Challenge
The supplies needed for the 100 Day Challenge are not complicated and you should have most of them around your house. If not, you can make a list and shop for them.
Supplies Needed:
Envelopes – Plain old white envelopes work, but colored envelopes make everything more fun.
Sharpie or Marker Pens – You need something to write with in order to keep track of those envelopes.
Cash – You need to figure out where you have the extra cash to stuff those envelopes. You may need to run to the bank quite a few times.
Stickers or Rubber Stamps – To make sure you don’t cheat and reopen a finished envelope.
Box or Container – Just make sure you have enough space for your envelopes!
Or Just Shop for this handy dandy premade Money Saving Box!
Related Read: Best Cash Envelopes – Pick Your Favorite
DIY 100 envelope challenge tracker
Also, it is super helpful to have a free printable 100 day challenge to keep you accountable! Don’t worry… we have you covered!
At the bottom of the post, you have the opportunity to download the image of the free 100 envelope challenge PDF.
Printable 100 envelope challenge
The 100 Envelope Challenge is a printable tracker chart you can download and print. Go to our resource library (for our email subscribers) to print the image.
It details how to set up an envelope challenge with your friends, family members, or co-workers.
The idea is that in the course of six months you will have earned $5,050 in savings by doing this challenge!
This 100 envelope challenge tracker is a useful tool for tracking the progress of your endeavor. You want to use a 100 envelope challenge tracker to keep you motivated during the next six months and reach your goal.
It can be printed or colored digitally and allows you to stay on top of how much money you need each day or each week.
100 Envelope Challenge App
As of right now, there is no $100 envelope challenge app developed to make this cashless. However, you can do this challenge digitally and we will show you how to do it virtually.
In case you utilize a cashless envelope system, you may be wanting to do this challenge, but are not sure the best way to do it.
Here is how to do the 100 day challenge digitally:
Instead of using 100 envelopes, you could write on 100 pieces of paper, fold them up, and put them into a bag or box.
Every day you would draw out a new number (just like the normal challenge).
Make sure you have a separate savings account for the challenge.
Instead of placing cash into the envelopes, you will move money from your checking account to that separate savings account.
For example, on the first day, you pull out the number 53. Well, that means you would move $53 from your checking account into your newly open 100 envelope challenge savings account.
You are taking money from your normal spending and moving it away and into a savings account.
That way you are setting aside money, virtually into a different account.
100 Envelope Challenge Variations
Not everyone can complete the 100 envelope saving challenge as we discussed in this post.
So, here are some alternatives to still save money using a concept similar to envelopes and still target saving $5000:
100 envelope challenge weekly – Pull envelopes each week instead of daily.
Save $50 for every envelope.
Give yourself an hour and see how long it takes before opening your last envelope.
10k in 100 days envelope challenge (detailed below).
50 envelope challenge is a variation on the 100 envelope challenge.
Pull envelopes on payday.
It’s up to you how long it takes to get there and if you want to take some time off in between while continuing to spend less than your original budget.
Higher income? Then check out the 10k in 100 days envelope challenge. This accelerated saving challenge is perfect for you.
Honestly, the goal is to save $5000. How you use this information and reach your target dollar amount is completely up to you!
100 Day Envelope Challenge FAQs
If you’re looking for a free printable version of the 100 envelope challenge chart, you can find it in our free resource library.
This section provides our readers with plenty of printables they can enjoy.
Make sure you subscribe to our email newsletter.
Yes, you can do the 100 envelope challenge twice a week.
Instead of picking an envelope each day, you would pick an envelope two times a week. Then, you would finish the challenge in one year.
The premise of the 100 envelope challenge is a money making challenge that allows you to save money and stay motivated.
Yes, you can complete the 100 envelope challenge biweekly. You will have more time to complete the challenge this way.
Instead of completing the challenge in 100 days, it will take you 200 weeks. To shorten the time, you can pick multiple envelopes with each biweekly paycheck.
Find more biweekly money saving challenges.
The 1-100 envelope challenge is a social media trend where participants are asked to create an envelope with a specific number of envelopes inside of it.
At the end of the challenge, you will save $5050.
This assumes you follow the traditional 1-100 day envelope challenge with no variations.
The 100 Day Envelope Challenge will take 14 weeks and 2 days to complete.
Or about 3.5 months.
The goal of the challenge is to prove you can save money and to see how far you can push yourself.
When you complete the 100 day envelope challenge in its entirety, you will have $5,050.
Yes, you can complete the 100 envelope challenge UK, Africa, or any other country.
You can live wherever you want to participate. Since you complete this challenge on your own, you can adjust the challenge as you see fit.
Are You Ready for these Envelope Saving Challenges?
All in all, this is the one great thing that social media can offer – maybe even providing information that can change the dismal data on saving money.
It brought around a brand new challenge for you new hack for you to start saving money.
The 100 day envelope challenge is a fun goal to kickstart your money saving journey.
The 100 day money envelope challenge may be too aggressive for what you can do right now, so here are great options to build those saving habits:
If you like the idea of this challenge here are some other money saving challenge ideas that you may enjoy more:
Know someone else that needs this, too? Then, please share!!
Did the post resonate with you?
More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!
Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.
TPO, MERS Review, LOS Products; Fannie/Freddie Changes; Rates React to Jobs Data
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TPO, MERS Review, LOS Products; Fannie/Freddie Changes; Rates React to Jobs Data
By: Rob Chrisman
Fri, Jun 7 2024, 11:44 AM
Huh? Michigan passed California in legal weed sales? The folks here in San Diego don’t seem to mind, and many on the street are doing their part to keep up as they have for a long time. The only thing constant through time is change… And time flies. Chuck Norris is 84 years old. Jerry Seinfeld is 70. Vanna White is 67. “Captain Jack Sparrow” is 60. LOs and lenders know that business is cyclical and are working on positioning themselves for the next refi wave. Some top LOs and lenders are now doing 20-30 percent of what they were doing in the pandemic years of 2020 and 2021. The numbers over the months and years bear that out: Curinos calculates that May 2024 funded mortgage volume decreased 5 percent YoY and increased 9 percent MoM. In the retail channel, funded volume decreased 10 percent YoY and increased 9 percent MoM. (Curinos sources a statistically significant data set directly from lenders to produce these benchmark figures.) Today’s podcast is found here, and this week’s are sponsored by Visio Lending. Visio is the nation’s premier lender for buy and hold investors with over 2.5 billion closed loans for single-family rental properties, including vacation rentals. Hear an interview with reporter Steven Rappoport on the current home-equity market and how technology in the space is evolving to help originators win business.
Software, Products, and Services for Lenders and Brokers
If you’re tired of long contracts, failing implementations, or having to change your process to fit your Loan Origination System, maybe it’s time to see what happy Byte clients have known for years in this video. You don’t have to keep suffering with a slow, expensive LOS platform or sacrifice functionality to lower your costs. Designed to be both powerful and flexible, the Byte LOS platform gives you total control over your loan process and the freedom to do business the way YOU want. If you’re a savvy, independent-thinking lender with an uncompromising ideal of how you want to run your operation, request a demo or visit bytesoftware.com to learn more.
“Act now and unlock big savings! Schedule your firm’s 2024 MERS Annual Report Review with TENA Companies, Inc. today. Each year, MERS requires its members to submit an Annual Report. If you are the named servicer on 1,000 or more active MINs as of March 31st, 2024, you must have your MERS Annual Report reviewed by a qualified third-party review firm and completed by December 31st, 2024. Get ahead of the curve and secure a significant 40 percent discount on your 2024 MERS Annual Review by partnering with TENA and providing all required documentation by August 31st. Our streamlined process minimizes your workload: simply provide the required documentation, we’ll handle the rest! Since 1982, TENA Companies, Inc. has been the mortgage industry’s trusted leader in Quality Control Audit Services and Software. Ensure your firm remains in compliance for 2024: Contact TENA today to learn more and lock-in your early-bird discount.”
Rocket Pro TPO prioritizes affordability with its popular ONE+ by Rocket Mortgage product. Eligible clients can put just 1 percent down, with Rocket Pro TPO covering an additional 2 percent as a grant, not a loan or lien. This means clients start building equity from day one. As interest rates fall and clients choose to refinance, they benefit from built-in equity. Stay informed with the latest industry updates and market trends on the Rocket Pro TPO YouTube channel. Looking to elevate your business? For exclusive opportunities, partner with Rocket Pro TPO and gain access to its Pro Performance Sales Training on June 25th, designed to move buyers from no to yes, and boost success in the mortgage industry. Sign up now for Rocket Pro TPO’s IGNITE Live training on July 9th to discover more about their innovative offerings. Contact Rocket Pro TPO today to explore partnership opportunities that can benefit both your clients and your business.
Freddie and Fannie Updates
FHFA announced that Fannie Mae and Freddie Mac (the Enterprises) will enhance their Flex Modification policies to allow more borrowers facing longer-term hardships to achieve meaningful payment reductions. The updated Flex Modification policies will promote sustainable homeownership and the safety and soundness of the Enterprises.
Freddie Mac Resolve®: Deed-in-Lieu of Foreclosure Data Validation and Eligibility Error Messages Reference: This reference provides Resolve users with a quick way to view detailed, actionable feedback messages, including possible causes and next steps.
Freddie Mac Resolve®: Charge-Off Request Validation Error Messages Reference: This reference provides users with a quick way to view detailed and actionable feedback messages for data validation and eligibility errors, including possible causes and next steps.
Freddie Mac Loan Selling Advisor® Seller User Roles Job Aid: Learn about the Seller user roles for Loan Selling Advisor. Share this job aid with your administrator for user role provisioning in Freddie Mac Access Manager.
In alignment with Freddie Mac and at the direction of FHFA, Fannie Mae issued Lender Letter (LL-2024-02): Updates to Determining the Flex Modification Terms to expand borrower eligibility and provide more equitable payment reduction to eligible borrowers. Key changes include revising the mark-to-market loan-to-value (MTMLTV) based requirements and incrementally applying the terms to target 20 percent P&I payment reduction. Servicers may implement these changes starting Nov. 1 but must implement them by Dec. 1.
Fannie Mae Desktop Underwriter/Desktop Originator Release Notes, DU Version 11.1 July update.
Fannie Mae’s down payment assistance tool makes it easier to explore and compare various down payment assistance programs. You and your borrowers can compare up to four different options and see a side-by-side view of features, including maximum amount of assistance, household income limits, and more.
Fannie Mae’s May Quality Insider features the defect trends we are seeing in our post-purchase loan file reviews. Read the article to understand these issues and learn some of our best practices to help manage risk and improve loan quality.
Pennymac posted 24-53: Updates to Conventional LLPAs stating it will add a new ‘HomeReady’ LLPA to the ‘LLPAs by Product Feature for All Eligible Loans’ Grid, effective for all Best Efforts Commitments taken on or after Monday, June 3.
National MI announced updates to the TrueGuide® which include changes and clarifications on AUS and Non-AUS Loans. For details, view National MI Announcement: UW 2024-02.
Newrez announced Conforming Loans underwriting guideline updates in Newrez Correspondent 2024-033.
Effective with announcement 202405021-CL, AmeriHome has removed and clarified certain Conventional and Non-Delegated overlays.
Capital Markets
The global rate-hiking cycle is seemingly done as the strength of labor markets around the globe weakens. The European Central Bank, in a widely expected move, cut its benchmark rate 25 basis points to 3.75 percent yesterday. It was the ECB’s first rate cut since 2019, though the central bank was quick to caution investors that it is not committing to any predefined rate path and that forward looking policy will remain data dependent, all but ruling out another cut for July. That came on the heels of the Bank of Canada cutting rates on Tuesday. June fed funds futures don’t see a cut when the Fed meets next week. However, markets are now pricing in nearly two full 25 basis point cuts before year-end as this week’s weaker than anticipated private payroll readings from ADP and a decrease in job openings have investors excited about the prospect of rate cuts from the Fed. Today’s jobs data will give the Fed its last major indicator before next week’s meeting.
Speaking of that jobs data, the first Friday of the month brings payrolls, and the economy added +272k, much stronger than expected, jobs throughout the month of May versus 185k expectations and 175k previously. The unemployment rate was 4.0 percent when it was expected to remain static at 3.9 percent. Average hourly earnings (+.4 percent) when it was seen increasing 0.3 percent month-over-month and 3.9 percent year-over-year versus 0.2 percent and 3.9 percent previously. BLS data suggests that U.S. payroll gains were not as robust as reported in 2023, and the overestimate may have been 60k a month. This would indicate that the job market is weaker than the Fed thinks, though the central bank does understand that job gains and pay growth are slowing going into the second half of the year, and there are notable pockets of weakness tied to both producers and consumers.
Later today brings wholesale inventories and sales, the Fed’s release of Q1 Flow of Funds, and consumer credit for April. After the employment data Agency MBS prices are worse .250-.500 from Thursday’s close, the 10-year is yielding 4.41 after closing yesterday at 4.28 percent, and the 2-year is at 4.84.
Employment
“Are you exceptional at building and leading origination teams and are currently working for a company that doesn’t recognize your value as a manager? At Planet Home Lending, we understand that strong local leadership moves the dial on national success. You bring the insights from Main Street; we provide a dynamic platform where your ideas fuel product innovation and shape our operational strategies, all within the framework of a financially stable, multichannel ecosystem. Contact Senior Vice President Doug Long at (407) 399-5505 and explore how joining Planet can propel your career. Let’s build success together!”
A very well capitalized, mid-sized IMB servicing 100 percent of its loans in-house without a sub-servicer, headquartered in a Rocky Mountain State, is looking to acquire smaller retail IMBs who would prefer to focus on production and at the same time gain operational efficiencies. Understanding that every company has a very unique culture, the IMB is willing to allow these IMBs to operate with a large degree of autonomy, allow you to keep your trade name, and treat you as your own company. Geography is not an issue. We believe that a larger company forcing their culture upon the company being acquired never works over the long term. The vision is for this IMB to hit $5 billion in annual volume with likeminded people, and it has no desire to grow beyond that volume as the President “wants to be big enough to be a player, yet small enough to keep our soul.” Confidential inquiries should be sent to Chrisman LLC’s Anjelica Nixt for forwarding.
“Jim Bromwell has joined employee-owned USA Mortgage as a Regional Manager. Working from offices in the Mid-Atlantic and Northeast, the 29-year industry veteran is tasked with growing USA’s presence in markets in the Eastern United States. ‘USA Mortgage is a 100 percent employee-owned company where the employees truly have a voice and a genuine ESOP account,’ he said. ‘I feel USA Mortgage is one of the top platforms in the industry centered around adding value to Loan Officers and their partners. It has a significant presence in the Midwest and is well positioned to grow across the country, which is exciting! While the company is large, it has the “hometown” feel that is appealing in today’s market.’ Founded in St. Louis in 2001, USA has offices in 34 states and is licensed in 49 states plus the District of Columbia. To initiate a confidential conversation about joining USA, contact us here.”
A growing mortgage lender on a mission to be a top player in the wholesale channel is in search of a Head of Operations who’s a strategic mastermind. With at least 5 years of experience leading and wrangling the complexities of wholesale and non-delegated lending, you see technology as your key to unlocking growth (think AI, automation, the whole efficiency toolkit). You thrive on streamlining processes, making approvals super-fast, and motivating your team to break records with infectious enthusiasm. You must be obsessed with the customer experience. This ain’t your average mortgage gig. We’re on a quest to change the game. Ready to join the adventure? Confidential and serious inquiries can email Chrisman LLC’s Anjelica Nixt; please specify the opportunity.
Vienna and now Norway? SNMC Sets the Standard for Industry President’s Trips. Upon return from the SecurityNational Mortgage Company’s 2024 President’s Trip to Vienna, Austria, SNMC President Andrew Quist unveiled an equally extraordinary journey for 2025. How can we possibly top the unforgettable experience of Vienna? An exclusive 7-day cruise from England to Norway. SVP, Joel Harward noted, “Vienna was a fantastic trip where so many great memories were created. The 2025 Norway cruise we just announced reaffirms SNMC’s dedication to motivating our top salespeople and the value we place on celebrating our President’s Club qualifiers.” To explore more about SecurityNational Mortgage Company’s commitment and track record of renowned sales trips, you can click here to learn more today!
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“Buy now, pay later” services are a way of financing in-person or online retail shopping. Now, many BNPL companies, including the Zip (formerly Quadpay) buy now, pay later app, offer pay-in-four plans to secure travel bookings, like airfare and hotel accommodations.
If you have unexpected travel come up, you might consider Zip BNPL for travel expenses at checkout. Here’s what to know.
How using Zip for travel expenses works
Zip BNPL offers a pay-in-four installment option. To make travel-related purchases on Zip, follow these steps:
Launch Zip and search your travel needs. Open Zip’s buy now, pay later app and search for a travel provider that Zip partners with. Travel providers that support Zip include Hilton, TripAdvisor, Hotwire, JetBlue Airways, Booking.com, American Airlines and Lyft.
Choose “Pay with Zip.” Once you’ve added your travel expenses to your Zip cart, select “Pay with Zip” to request an installment plan.
Confirm your order details. If you’re granted spending power with Zip, you’ll see the order summary, order total, finance charge and total cost. You’ll also see how much is due today, and the amount due for each remaining installment. Verify everything looks correct. You can also select your preferred payment method during this step. Select “Agree and continue.”
Make your first installment payment. Zip automatically fills in your payment details based on your saved payment method. Confirm the details are up to date — including your card’s expiration date and CVV — then, complete the order.
When using Zip for travel expenses might be useful
Paying for travel with Zip can offer a couple of benefits, instead of paying for your travel arrangements in full and upfront.
If you don’t have strong credit or a credit history, Zip can be a straightforward option for acquiring financing for your travel costs. Although it’s short-term financing, it whittles large expenses into bite-sized installments you might otherwise not have access to.
Zip’s BNPL service might be preferred over other buy now, pay later apps because of its payment date flexibility. If you can’t make your installment on the due date, you can change the payment date for free. This feature is available for free once per month. Subsequent payment date changes in the same month incur a $2 fee. It’s a useful perk for travelers needing more flexibility with their BNPL payment due dates that other services might not offer.
Why Zip pay later might not be ideal for travel purchases
There are circumstances when making Zip travel now, pay later purchases is a fair — if not practical — way to pay for travel in smaller bursts. But there are also downsides to financing travel costs with Zip pay later.
1. Upfront installment fee
Zip doesn’t directly charge interest on its four-payment installment plan. Technically, it’s 0% interest. What’s easy to overlook, however, is that it imposes a finance charge, which Zip calls its “installment fee.”
This fee is automatically divided into four and added to each installment payment on your plan. It ranges from $0 to $7.50 per order. How much you’ll pay depends on the order’s purchase price and the Zip product chosen. Although it seems like a relatively small sum for the convenience of avoiding a lump-sum expense, it adds up.
For example, let’s say you’re a member of your best friend’s wedding party and planning a trip across the country to celebrate their special event. You don’t have the cash to pay for everything upfront, so you use Zip pay later for your wedding attire, gift, plane ticket and hotel room. Each of these transactions incur an installment fee. Assuming a $7.50 fee for each expense and an order total of $1,000 for the four transactions, you would pay $30 in fees or a 3% finance charge.
2. No monthly repayment term option
Zip doesn’t offer a monthly payment plan, unlike its competitors. Any Zip travel pay later installments must be made by the due dates within a six-week period.
Americans expect to spend $3,594, on average, toward a summer vacation this year, according to a NerdWallet survey of over 2,000 U.S. adults. With a $7.50 installment fee added to that sum, each installment would cost $900 per payment.
Based on Zip’s pay-in-four option, you would need to make this $900 payment every two weeks which can be restrictive for some people. If you miss a payment, you’ll be hit with a $7 late fee and Zip will automatically pause your account until you are caught up, meaning you won’t get approved for additional orders.
Conversely, alternative financing options offer a longer repayment term that can make monthly payments more palatable. And though BNPL can be a convenient and low-cost payment option, you’re still taking on debt, and it’s rarely a good idea to go into debt for a nonessential purchase.
3. Getting a refund takes time
When making a traditional credit card purchase toward travel, credit card refund timelines vary based on your card issuer’s process. You’ll typically receive a travel refund back to your original payment method within a few days.
With Zip, processing a refund requires the merchant’s approval. Once it receives the funds back from the merchant, it can take up to an additional 13 days for Zip to process the refund. This processing time might not be ideal for people who need their refund faster.
Is using Zip pay later right for you?
Zip can be a practical option to get urgent travel on the books, without having to pay for the expense before your trip. If you have an irregular financial situation and need leeway with your payment date, it might be worth looking into Zip.
However, it may not be worth it if you’re planning a more costly vacation, as all payments must be complete within six weeks. And many of its competitors, such as Affirm and PayPal, offer a similar payment plan without an installment fee.
If you choose to use Zip for BNPL, be sure you go in with a strategy and know what you can afford.
Hedging, POS, DPA, Verification, Fee Cure Paper; Conference Chatter; Training and Events
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Hedging, POS, DPA, Verification, Fee Cure Paper; Conference Chatter; Training and Events
By: Rob Chrisman
Thu, Jun 6 2024, 11:41 AM
“My granddad was responsible for 25 downed German planes in WW II. To this day, he is still known as the worst mechanic the Luftwaffe ever had.” On the anniversary of D-Day, let’s hope the entire world is not involved in a war again, although humans have had a recurring theme of conflict. Scaling things down significantly, but keeping with the “recurring theme” theme… There have been recurring themes in the various conferences and private events, most recently the MBA New Jersey which my son Robbie attended and this one I am attending in San Diego for Bay Equity, that lenders have their eye on. Lowering the cost of doing business, including the closing costs seen by borrowers (and mentioned by the White House and regulators to lower housing costs). Lenders try to use every advantage they have to gain and retain borrowers, and improve operational efficiencies, and how doing that will help originators. Last but not least, the constant decision to retain or release servicing, and the long-term impact of that on business. It is, indeed, a tough environment, entirely different than four years ago when everyone was hiring, hiring, and hiring. (Today’s podcast is found here, and this week’s are sponsored by Visio Lending. Visio is the nation’s premier lender for buy and hold investors with over 2.5 billion closed loans for single-family rental properties, including vacation rentals. Hear an interview with PCV Murcor’s Marc Tatarcuk on how Appraisal Management Companies find and assign appraisers, how AI is influencing the appraisal space, and what the appraisal landscape currently looks like.)
Software, Products, and Services for Lenders and Brokers
Did you know that more than one in three loans results in fee cures averaging $1,225 per impacted loan? A recent study by ICE analyzed nearly 90,000 loans over a six-month period to determine the frequency of Loan Estimate and Closing Disclosure fee cures and quantify their cost. ICE found that by mitigating fee cures, lenders in the study could save more than $1.2 million for every 1,000 loans produced. The study’s results are detailed in ICE’s complimentary white paper, The hidden cost of fee cures, where you can view the data, learn how fee cures are eroding lender profit margins and find out what you can do to help protect your profitability. Download The hidden cost of fee cures here.
A 30-minute meeting with Planet Home Lending’s Correspondent sales team this month could be the catalyst for a year-round boost in your business. Explore our continually refined product lineup spanning vanilla to niche products all tailored to your unique needs: Best effort, mandatory AOT, delegated, or non-delegated. Join us at the MBA of Florida’s Eastern Secondary Conference & Convention, June 11-13, by reaching out to Regional Sales Manager Jim Shaler (813-784-6237). To schedule a meeting at the Indiana MBA State Convention, June 17-18, contact Regional Sales Manager John Theil (330-717-4543).
Founded in 1998, NFM Lending could be considered a member of Gen Z, the generation of digital natives, so it’s no wonder technology has been central to the award-winning IMB’s strategy since day one. One of NFM’s most recent tech wins has been placing Argyle at the top of its VOIE waterfall, a decision that has allowed it to optimize the borrower experience, shave at least a day off application processing times, and save 80 percent on income and employment verifications. As Chief Strategy Officer Cindy Keith explains, “They give us one-stop access to all of the income data and documents we need. Only after Argyle do we move on to other options, where prices might increase.” Read the full case study here.
While the Fed didn’t deliver the interest rate relief many were anticipating, there’s still an opportunity for you to save your borrower’s money. Due to its tremendous success, Click n’ Close has expanded its DPA with Shared Appreciation product nationwide (excluding NY), enabling you to offer your borrowers a below-market interest rate AND help with their down payment. What’s more, Click n’ Close has increased the availability of its Title Attorney Opinion Letters (AOLs) through its title subsidiary Click n’ Close Title to include AL, AZ, FL, GA, NC, OH, PA, SC, TN, TX and UT. When combined, the Shared Appreciation w/ DPA and Title AOL can help make homebuying more affordable than ever. To learn more, contact a member of the wholesale lending team (Soliman Martinez, Adam Rieke, or Kerry Webb) today.
Most people are surprised when they find out that the high profile fintech mortgage companies use the same LOS as them. The difference? The fintechs bolt on a POS that differentiates the borrower experience instead of using the free one that came with the LOS. Level up your POS game with LiteSpeed.
Webinars, Training, and Events
Today join AFR Wholesale’s Rob Pieklo and industry expert Rob Chrisman for an insightful discussion on pivotal topics shaping the mortgage landscape at 2 pm EDT during the webinar ‘Betting on the Mortgage Industry: Why Private Money is Investing in Home Financing’. Register now! This exclusive webinar will cover critical areas such as rising interest rates and their impact, inflation concerns, potential economic challenges, and the future of Mortgage Servicing Rights (MSR). Don’t miss this opportunity to gain valuable insights and stay at the forefront of industry developments. Secure your spot by registering here. For more information, contact us at [email protected], call 1-800-375-6071, or visit www.afrwholesale.com. Ensure you’re part of this essential industry discussion!
A good place for longer term conference planning is to start is here, and click on “Conference List” for in-person events in the future.
Today will be another episode of The Big Picture at 3PM ET, Rich Swerbinsky is interviewing Vice Capital’s Chris Bennett about a wide variety of capital markets issues.
Friday the 7th will see an episode of The Mortgage Collaborative’s Rundown with Melissa Langdale and me covering current events in the mortgage market for 30 minutes starting at noon PT, 3PM ET, in “The Rundown”. We have California MBA CEO Susan Milazzo on the show!
Want to learn more about what Freddie Mac is up to? Resolve®: Submit and Manage Deed-in-Lieu of Foreclosure Requests Webinar (2 hrs.). Learn how to submit and manage deed-in-lieu (DIL) requests via a single or multiple loan file submission, including decisioning on Guide-eligible transactions and those requiring exception review. And there’s the Loan Product Advisor® Recent Updates Webinar (1.5 hrs.). Learn more about the enhancements we’ve made to Loan Product Advisor® (LPASM ) to help you reduce costs, improve efficiency and deliver a better borrower experience.
Monday, June 10th is MMBA’s annual Beacon Hill Day. Members will be placed into groups for appointments with State Representatives and Senators. This is the same day that the REALTORS are on Beacon Hill too. The MMBA will be providing you with talking points and handouts for your appointments as well as coordinating appointments with other MMBA members in your area.
Next week in Sarasota, Florida, 6/11-6/13, we have the MBAF’s 2024 Convention & Conference! Yes, Check out the Agenda for the June 11-13 Mortgage Bankers Association of Florida’s 20th Eastern Secondary Conference and 70th Annual Convention.
If insights and brilliance of top-level financial and mortgage lending experts are what you need to succeed in today’s market, look no further than the upcoming ACUMA FOCALpoint Workshop scheduled for June 11-12 in Denver, CO. In addition to top names like CFPB executive Mark McArdle and Steve Rick, chief economist for TruStage, our 16-speaker lineup includes top credit union executives like Elevations CU, SVP of Lending Elizabeth Million, Westerra CU, VP of Mortgage, Michelle Burke, and many others, will help cultivate your increased mortgage lending wisdom.
On Jun 11th, 12-1:00PM, join NAMB & Berman Media to learn how to create more content in less time so you can get more leads from Instagram. The webinar will cover how to create killer content so you can get more views without needing a videographer, effortlessly prospect using Instagram without spending hours on the platform and get more engagement than ever before without needing to post every day.
Free, in-person, FHA credit underwriting training is in Miami, FL: June 12, 9:00 AM – 4:00 PM (Eastern).
Looking for more in-depth commentary on weekly mortgage news? Register here for “Mortgage Matters: The Weekly Roundup” presented by Lenders One. Next Wednesday at 2:00 PM EST/11:00 AM PT Robbie Chrisman and Justin Demola will interview Max Slysarchurk of A&D Mortgage.
Simplify the process of reverse mortgages with the Plaza Home Mortgage live session on Thursday, June 13, 11:00 AM PT / 2:00 PM ET featuring Mark Reeve, Vice President of Plaza’s Reverse Mortgage Division.
National MI June webinar sessions include Income Case Studies with Marianne Collins – June 11th at 1pm ET, Cracking the Code for Consistent Client Growth with Nancy Bleeke Noël – June 12th at 1pm ET, and Coaching for Development with Andrew Oxley – June 13th at 2pm ET.
Join CoAMP and Advantage Credit on June 13th, 5-7 PM at Sheraton DTC for a fun filled Happy Hour that includes networking and an update on current credit issues/practices by Dena Falbo w/Advantage Credit. Admission is free, there will be food and beverages for purchase.
The FHA is conducting a free, two-day, on-site Lender Training in Santa Ana, CA on June 12th, 8:00 AM through June 13th, 5:00 PM. Featured topics include underwriting the FHA appraisal and endorsement protocols; Loan Review System (LRS); and much more.
Capital Markets
In any market scenario, it is crucial for lenders to analyze best execution options to maximize profitability when selling loans in the secondary market. Determining what execution is most efficient and profitable will have a big impact on the bottom line. In MCT’s whitepaper, Optimizing your Best Execution Loan Sale Analysis, they provide insight into determining your company strategy, delivery options, retain release decisions, and more. Download the whitepaper or join MCT’s newsletter to stay up to date on the latest educational content.
The summer is kicking off, and you know who is making waves? CapitalW Collective! In the weeks following the MBA Secondary in New York, CapitalW’s impact is growing. It’s building relationships and being endorsed by major industry players. Follow the non-profit on LinkedIn and become a sponsor!
Rally, rally, the pitcher’s name is Sally! That’s what we used to chant in Little League, and it’s what bond traders could be chanting this week as rates once again dropped yesterday. The ADP Employment Change report showed an estimated 152k jobs were added to private-sector payrolls in May, the slowest pace of the year versus expectations of a 175k reading after a downwardly revised 188k print in April. The report conveys softening job gains and pay growth, which is something that should be relatively pleasing to the Fed’s eye.
That comes on the heels of Job Openings printing at the lowest level since 2021 on Tuesday, signaling that the Fed’s tightening cycle is finally starting to chip away at labor market resiliency. Investors are once again ramping up bets that the Fed will cut rates before year-end.
The ISM Non-Manufacturing Index, the most important data point this week outside of May payrolls tomorrow, increased well into expansionary territory in May from contractionary territory in April. The May reading is the best since August 2023. The ISM’s business activity index also had its largest monthly advance since March 2021 and signals a pickup in activity in the nation’s largest sector with prices paid remaining elevated, albeit less so than the prior month. Opposite of what was mentioned in the previous paragraph, it is a report that doesn’t command a rate cut soon.
Job cuts from Challenger, Gray & Christmas for May kicked off today’s calendar, along with weekly jobless claims (229k), the April trade deficit, and Q1 final productivity and unit labor costs… none of which moved rates. Looking toward later today, the U.S. Treasury will announce the details of the mini-Refunding (consisting of $58 billion 3-year notes, $39 billion reopened 10-year notes, and $22 billion reopened 30-year bonds) and Freddie Mac’s Primary Mortgage Market Survey will be released. After the Bank of Canada yesterday lowered its policy rate by 25 basis points to 4.75 percent, as expected, this morning brought the latest ECB decision, a 25-basis point cut to 4.25 percent. We begin the day with Agency MBS prices are unchanged from Wednesday’s close as is the 10-year yielding 4.29 percent. The 2-year is at 4.73.
Employment
A 49-state licensed mortgage lender with a large servicing portfolio and strong capital base is seeking to expand its retail footprint by partnering with large production teams or regional mortgage banks interested in a capital partnership. The goal of the relationship is to leverage back-office mortgage functions (e.g., secondary, technology, compliance, operations, and licensing) to provide you with long-term production growth opportunities. By partnering with us, you can utilize our mature systems to add loan officers and scale your operations across the U.S. If you are a strong retail loan origination team feeling constrained by layers of management, or an independent mortgage lender looking for new options for your team, we offer a compelling alternative to standard “branch” offerings. Confidential and serious inquiries can email Anjelica Nixt.
Asurity Technologies, LLC announced that mortgage technology vet Brad Vasto has joined the company as SVP – Sales. Leveraging his 30+ years of experience in meeting the needs of the mortgage, banking, and financial services industries, Brad will be responsible for sales activities relating to Asurity’s industry leading Software-as-a-Service (SaaS) mortgage loan compliance products, including RegCheck® and Propel™. Congratulations!
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Bonds made it almost all week putting on a superhuman display of immunity to bad news, but Friday’s jobs report was the kryptonite. Whether or not a trader has any criticism for volatility in the payrolls data, they still agreed on the move with 10yr yields up nearly 15bps by the close. MBS outperformed nicely, as we were hoping they would, thus limiting the worst possible rate sheet outcomes. In fact, we’re ending the week in better shape than the last and thoughts have already turned toward next week’s bigger ticket events (CPI on Tuesday and the Fed on Wed). And yes, this is a “dots” meeting for the Fed…
Nonfarm Payrolls
272k vs 180k f’cast, 175k prev
Unemployment Rate
4.0 vs 3.9 f’cast, 3.9 prev
08:36 AM
Much weaker after jobs data. 10yr up 13.7 bps at 4.425. MBS down more than half a point.
11:12 AM
Holding AM losses uneventfully after modest bounce. 10yr up 12.9bps at 4.417 and MBS down 3/8ths.
01:50 PM
Still very little movement relative to AM losses. MBS down 13 ticks (.41) and 10yr up 13.7bps at 4.425
03:43 PM
Stick a fork in the bond market. It’s done for this week and nothing interesting happened today after the first few minutes following NFP. Trading levels right in line with the last update… still
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Bonds Continue Taking Their Seats Ahead of The Big Show
By:
Matthew Graham
Thu, Jun 6 2024, 4:12 PM
Bonds Continue Taking Their Seats Ahead of The Big Show
Although bonds continued to improve yesterday, the pace of gains has progressively slowed throughout the week. Our base case was for that momentum to shift sideways or pull back a bit today and that’s exactly what we’ve seen. It was the base case because it would be a logical move for a market that is leaning in a bullish direction as it waits for the data with the power to endorse or reject the bullish lead-off. 5 straight days of gains (plus a counterintuitive rally following ISM Services) was plenty. Today’s relatively flat performance is actually just another indication of latent optimism for friendlier data in the future. As for the “big show,” it remains to be seen how much of the spotlight goes to Friday’s jobs report with next week’s CPI continuing to be at the top of the marquee.
Jobless Claims
229k vs 220k f’cast, 221k prev
Challenger Layoffs
63.8k vs 63.8k f’cast
09:49 AM
Moderately weaker overnight and recovering slightly in 9am hour. 10yr up 1.4bps at 4.29 and MBS down 1 tick (.03).
12:39 PM
Sideways near opening levels. MBS down 2 ticks (.06) and 10yr up 2bps at 4.295
02:20 PM
Treasuries near best levels, but still up 0.8bps at 4.284. MBS down 1 tick (.03).
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Both certificates of deposit (CDs) and money market accounts (MMAs) are types of savings accounts that tend to earn higher interest rates than traditional savings accounts. But there are some key differences between them.
An MMA allows you to withdraw money as needed (and even comes with checks or a debit card), though you may be limited to a certain number of transactions per month. With a CD, on the other hand, your money is locked up for a set period of time. In exchange for leaving your money untouched, however, CDs generally pay higher rates than MMAs.
Whether you should choose a CD or MMA will depend on your financial needs and goals. To help you make the right choice, here’s a closer look at how these two savings options compare.
Main Differences Between Money Market Accounts and CDs
Here’s a quick snapshot of the differences between money market accounts and CDs.
Money Market Accounts
CDs
Interest rates
Variable; typically lower
Fixed; typically higher
Liquidity
Highly liquid
Lacks liquidity (early withdrawal incurs a penalty, in most instances)
Minimum balance requirements
Higher than regular savings accounts
Varies by CD
Debit card/checks
Yes
No
Money Market Accounts
A money market account (MMA) is a type of savings account offered by banks and credit unions that provides some of the conveniences of a checking account. Like a typical savings account, you earn interest on your deposits, often at a higher rate than what you could earn in a traditional savings account. In addition, these accounts typically come with checks and/or a debit card, making it easier to access your funds.
Money market accounts may come with withdrawal limits (such as six or nine per month), however, so they aren’t designed to be used as a replacement for a checking account. MMAs also often require you to keep a certain minimum balance in order to avoid fees or earn the advertised annual percentage yield (APY).
The money you deposit in an MMA is insured up to $250,000 by the Federal Deposit Insurance Corporation (FDIC), if held at an FDIC-insured bank, or by the National Credit Union Administration (NCUA), if held at an insured credit union. That means you can’t lose your money (up to certain limits) even if the bank were to go bankrupt or shut its doors.
Pros and Cons of Money Market Accounts
Here’s a look at some advantages of opening a money market account.
• Higher interest rate: Typically, money market accounts have higher interest rates than traditional savings accounts.
• Security: Because of the FDIC and NCUA insurance, the funds in a money market account are typically insured against loss.
• Funds are liquid: You can withdraw your money when you need to (though you may be limited to a certain number of transactions per month).
• Ease of access: It’s possible to access the funds in a money market account by withdrawing cash at an ATM, doing an electronic transfer, using a debit card, and/or writing checks.
MMAs also have some disadvantages. Here are some to keep in mind.
• Better rates may be available elsewhere: You may be able to find a high-yield savings account at an online bank that offers a higher APY than an MMA at a traditional bank (with potentially fewer restrictions and/or fees).
• Minimum balance requirements: Banks often require a minimum deposit to open an MMA, as well as a minimum amount you must keep in the account in order to earn the top APY and/or or avoid a monthly maintenance fee.
• Variable interest rate: APYs on MMAs are based on market interest rates at a given time. It’s difficult to predict how the market will perform and if this interest rate will rise or fall.
• Limited growth potential: If you’re looking for long-term growth, you can potentially make more by investing your money in the market.
Certificates of Deposits (CDs)
A certificate of deposit (CD) is a type of savings account that offers fixed interest rate that is generally higher than a traditional savings account. A CD also comes with a fixed-term length and a fixed maturity date. This means you need to leave the funds in a CD untouched for a set term, which can range anywhere from a few months to several years. Generally, the longer the CD’s term, the higher the APY, but this is not always the case.
CDs don’t charge monthly fees, but will typically have an early withdrawal penalty, and you usually can’t add any additional funds after the initial deposit.
CDs are offered by banks and credit unions: at credit unions, they are often referred to as share certificates. Like regular savings accounts, CDs are typically insured by the FDIC or NCUA, so you get your money back (up to $250,000) in the unlikely event that the bank or credit union were to go out of business.
Pros and Cons of CDs
Here’s a look at some of the advantages that come with depositing money into a CD.
• Potentially higher rates: CDs tend to offer higher APYs than regular savings accounts and money market accounts.
• Guaranteed rate of return: Because CDs typically have fixed rates for fixed terms, you know up front how much interest you will earn.
• Security: Like other types of savings accounts, CDs are insured by either the FDIC or NCUA.
• Convenience: It’s fairly easy to open a CD, since most banks and credit unions offer them.
There are also some disadvantages of CDs that you’ll want to bear in mind.
• Relatively low returns: While CDs tend to earn more than a regular savings account, investing in stocks and bonds can be a better option if you’re looking to maximize your returns over the long term (though, unlike CDs, returns are not guaranteed).
• Rates won’t go up: Because CDs come with fixed interest rates, the APY won’t go up even if market rates rise during the term of your CD (unless you open a bump-up CD).
• No liquidity: Unlike other types of savings accounts, you can’t withdraw funds as needed. To benefit from a CD, you must wait until the CD term ends before you access your cash.
• Withdrawal penalties: If you end up needing the money before the CD matures, you will likely incur an early withdrawal penalty.
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When Should I Consider a Money Market Account or CD Over the Other?
MMAs and CDs have different requirements and benefits, and which one will serve you best will depend on your needs and preferences.
Choosing a Money Market Account Over a CD
A money market account may be a better choice than a CD if:
• You want the option to add and withdraw money regularly. You can save money over time with a money market account. You can also withdraw the money at any time, though you may be subject to some restrictions.
• You’re building an emergency fund. A money market account can be a good place to stash your emergency fund. You can likely maintain the minimum balance requirement and can benefit from the extra interest. Should you need the money, however, you can get it right away.
• You’re saving for a large purchase. If you’re saving for a big ticket item like a car, a money market account will allow you to write a check from the account when you’ve reached your goal and it comes time to use those funds.
Choosing a CD Over a Money Market Account
A CD may be a better fit than a money market account if:
• You have a longer-term savings goal. If you don’t need to use the money for a year or two, you may benefit from the higher returns offered by CD.
• You want to make sure you don’t touch the money. If you’re setting aside money for a specific future expense, like a wedding or vacation, a CD helps insure you won’t impulsively spend it on something else.
• You want some growth without risk. Unlike money invested in the market, the money you put into a CD is insured (up to certain limits) and the rate of return is guaranteed.
Recommended: How to Save Money: 33 Easy Ways
The Takeaway
Both money market accounts and CDs offer safe ways to earn more interest on your savings than you could in a traditional savings account. While money market accounts offer more flexibility and liquidity than CDs, CDs tend to offer higher APYs.
If you won’t need the money for a set period of time (say, six months to three years), and can find a good rate on a CD, you might be better off going with a CD over an MMA. If you may need to tap the funds at some point (but you’re not sure when), an MMA allows you to earn a higher-than-average interest rate while keeping the money liquid, with the added benefit of offering checks or a debit card.
Before choosing any type of savings account, however, it generally pays to shop around and compare current APYs. You may find another savings vehicle, such as a high-yield savings account, that offers the returns you want with minimal requirement, restrictions, or fees.
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FAQ
Are CDs or money markets better?
If you don’t need to access your funds for a while, a CD could be a better fit. CDs tend to offer higher interest rates than money market accounts, and the interest rate is fixed which makes the return predictable. Conversely, if you might need to draw on the funds in the near-term, an MMA may be a better route.
What are the tax implications of money market accounts vs. CDs?
With both certificates of deposit (CDs) and money market accounts (MMAs), the interest you earn is considered taxable income. You will receive a Form 1099-INT from your bank at the end of the year, which you must report on your tax return.
The Interest from CDs is typically taxed in the year it is earned, even if you don’t withdraw it until the CD matures. This means you might owe taxes on interest even if you haven’t received it yet. Interest on MMAs, however, is usually credited monthly and taxed in the year it is credited.
What are other options besides money market accounts and CDs?
Money market accounts and certificates of deposit (CDs) offer a low-risk way to earn a solid interest rate on your money. But they aren’t your only option. Here are some alternatives:
• High-yield savings accounts. These accounts offer higher interest rates than traditional savings accounts and provide easy access to your funds with no fixed terms.
• Treasury Securities. U.S. Treasury bills, notes, and bonds are government-backed securities that can offer competitive returns. They vary in term length and interest rate and are considered very safe investments.
• Bond Funds. These mutual funds invest in a diversified portfolio of bonds, offering potentially higher returns than money market accounts and CDs, though they come with higher risk.
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SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
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Counterintuitive Reaction to Data, But We’re Not Upset
By:
Matthew Graham
Wed, Jun 5 2024, 4:08 PM
Counterintuitive Reaction to Data, But We’re Not Upset
The bond market did not stick to its usual script today. An important piece of economic data (ISM Services PMI) came out above the median forecast by an amount that is historically significant–an amount that would almost always result in immediate bond market weakness of at least several bps in terms of 10yr Treasury yields. Unsurprisingly, that happened right away, but then something else happened. Bonds quickly erased the losses and moved to the best levels of the day (where they stayed for the rest of the trading day). It’s a bit of a stretch to give credit to the components of the data, but it helps. Other explanations include anticipation for more palatable inflation data next week and, in the shorter-term, tame job creation in this Friday’s data.
ADP Employment
152k vs 175k f’cast, 192k prev
08:17 AM
Basically unchanged overnight and little reaction to ADP jobs. MBS unchanged and 10yr down less than 1bp at 4.319
10:38 AM
Volatility after ISM data with a brief pop to 4.358 in 10yr yields, but now back down 1.5bps on the day to 4.31+. MBS back up 1 tick (.03) after being down 2 ticks (.06) at the lows.
11:24 AM
Best levels of the day now with 10yr down 3.6bps at 4.291 and MBS up 5 ticks (.16).
02:25 PM
Fairly flat near best levels. Trading levels right in line as the last update.
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