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A strong reading in the Consumer Price Index is putting upward pressure on mortgage rates this morning. With rates continuing to move higher, we believe the best option for many borrowers is to lock in a rate soon on a purchase or refinance. It only takes a few minutes to get started, so take action today toward your ideal home financing situation. Read on for more details.

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Market Outlook 2.12.18 from Total Mortgage on Vimeo.

Where are mortgage rates going?                      

CPI pushes rates higher

We got arguably the most significant economic report of the week out this morning with the Consumer Price Index reading for January. Analysts had called for a monthly rise of 0.3%, but the actual reading came in slightly above that at 0.5%.

Click here to get today’s latest mortgage rates (Jul. 20, 2023).

With one of the leading theories for last Monday’s stock market turbulence being an uptick in inflation reflected in the rise in average hourly earnings, there was a lot of anticipation that a rise in inflation in today’s report could have a similar effect.

Looking at the market today, stocks did fall immediately after the release of CPI but have since moved back up to above where they started the day. Long-term Treasury yields also had an immediate reaction to the CPI reading, jumping up by several basis points.

The yield on the 10-year Treasury note (the best market indicator of where mortgage rates are going) is now up to 2.87%. That’s very close to the week’s high of 2.89% hit during early trading on Monday.

The implication here for financial market participants is that the Federal Reserve might be moving more towards four rate hikes in 2018 than the three rate hikes that have been expected.

Rate/Float Recommendation            

Lock in a rate soon

Long-term Treasury yields have moved back up near multi-year highs, putting upward pressure on mortgage rates. With rates continuing to move higher as the year progresses, it only makes sense to lock in a rate sooner rather than later.

Today’s economic data:                               

Consumer Price Index

CPI came in above expectations for January with a monthly rise of 0.5% compared to the 0.3% analysts had called for.

Retail Sales

Retails sales fell 0.3% in January. Retail sales less autos remained unchanged. The less autos and gas reading fell 0.2%.

Atlanta Fed Business Inflation Expectations

The Atlanta Fed Business Inflation Expectation for February came in at 2.0%.

Business Inventories

Business inventories are up 0.4% for December.

EIA Petroleum Status Report

For the week of 2/9/18:

  • Crude oil: 1.8 million barrels
  • Gasoline: 3.6 million barrels
  • Distillates: -0.5 million barrels

Get the GreenLight and close in 21 days*      

Notable events this week:                

Monday: 

Tuesday:    

  • NFIB Small Business Optimism Index
  • Fedspeak

Wednesday:      

  • Consumer Price Index
  • Retail Sales
  • Atlanta Fed Business Inflation Expectations
  • Business Inventories
  • EIA Petroleum Status Report

Thursday:        

  • Jobless Claims
  • Philadelphia Fed Business Outlook Survey
  • PPI-FD
  • Empire State Mfg Survey
  • Industrial Production
  • Housing Market Index

Friday:       

  • Housing Starts
  • Import and Export Prices
  • Consumer Sentiment

*Terms and conditions apply.

Carter Wessman

Carter Wessman is originally from the charming town of Norfolk, Massachusetts. When he isn’t busy writing about mortgage related topics, you can find him playing table tennis, or jamming on his bass guitar.

Source: totalmortgage.com

Apache is functioning normally

SmartAsset Advisors, LLC (“SmartAsset”), a wholly owned subsidiary of Financial Insight Technology, is registered with the U.S. Securities and Exchange Commission as an investment adviser. SmartAsset’s services are limited to referring users to third party registered investment advisers and/or investment adviser representatives (“RIA/IARs”) that have elected to participate in our matching platform based on information … [Read more…]

Apache is functioning normally

Minneapolis-based U.S. Bank, the fourth-largest U.S. mortgage lender, is laying off staffers in its mortgage division this week, a spokesperson confirmed on Tuesday. 

The announcement follows a decline in its mortgage originations in the first quarter of 2023 – the second-quarter earnings will be released on Wednesday morning.

The current jobs cut also comes amid rumors that depositary lenders would see changes to their residential mortgage capital requirements under the Basel III regulations.  

“At U.S. Bank, we make decisions that position us well for today’s market and in the future,” a spokesperson told HousingWire. “As a result, we have made the difficult decision to reduce resources in certain roles aligned to areas of the business that continue to slow – while investing in others where we see growth potential.” 

The spokesperson did not provide further details, such as the number of employees affected. Inside Mortgage Finance first reported news of the layoffs.   

U.S. Bank, owned by U.S. Bancorp, was number four among mortgage originators in the U.S. in the first quarter of 2023, according to IMF estimates.

However, mortgage volume has been in free fall at the bank amid surging rates. The bank’s total mortgage origination volume reached $9.6 billion from January to March, down 41.7% year over year.

The bank tries to maintain a balanced portfolio between retail and correspondent lending. From January to March, the bank originated a $4.47 billion volume in the retail channel and $5.8 billion through the correspondent channel, per IMF estimates.  

U.S. Bank would be affected by new residential mortgage capital requirements under the Basel III rules, which are expected to be released on July 27, according to a Bloomberg report. Under the latest draft proposal, risk weights of 40% to 90% would be assigned for large banks, depending on the loan-to-value ratio. The current rule sets a 50% risk weight on most first-lien residential mortgages.

The bank announced in December 2022 that it would close the wholesale mortgage businesses it inherited in the acquisition of California-based MUFG Union Bank. 

U.S. Bank closed the acquisition of MUFG’s core regional banking franchise from Japan-based Mitsubishi UFJ Financial Group at the beginning of December 2022, adding 1 million consumers and about 190,000 small business customers on the West Coast. 

The spokesperson said the layoffs are “not related to or specific to Union Bank.”

Source: housingwire.com

Apache is functioning normally

It’s been another up and down week for bond yields and mortgage rates. Right now, we’re looking at rates finishing out the week at levels close to where they started.

Inflation concerns are still creating ripples in the markets, and could very well continue to do so next week. It’s a volatile market right now for sure, with the long-term trend continuing to be for current mortgage rates to rise. Read on for more details.

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Market Recap 2.16.18 from Total Mortgage on Vimeo.

Where are mortgage rates going?                      

Rates down on the day as we head into the weekend

Financial market participants have an appetite for bonds today, pushing down Treasury yields. The yield on the 10-year Treasury note (the best market indicator of where mortgage rates are going) is down almost five basis points to 2.86%. We saw that yield hit a 4-year high on Thursday at 2.93%.

Click here to get today’s latest mortgage rates (Jul. 18, 2023).

Mortgage rates typically move in the same direction as the 10-year yield, and as we saw in the Freddie Mac Primary Mortgage Market Survey this week, the average rate on a 30-year fixed rate mortgage jumped up six basis points to 4.38%–its highest position since April 2014.

It was Wednesday’s Consumer Price Index report that was the main instigator this week, coming in with a monthly rise of 0.5%, two tenths higher than expected.

With inflation concerns on top of every investor’s mind, this reading only further bolstered opinions that the Fed will have to accelerate their rate hike path for 2018, meaning four or more increases.

The next opportunity for the Fed to increase the federal funds rate happens next month (3/21). Looking at the CME Group’s Fed Funds Futures, we can see that the market thinks there’s about an 83.1% chance that we get a quarter point increase up to 1.50%-1.75%.

With this type of scenario looming over the markets, it seems as though mortgage rates are destined to continue their climb. Already in 2018 we’ve seen the average on the 30-year fixed rate mortgage creep up 39 basis points. That’s no small increase.

Still, though, it is important to note that many analysts are calling for rates to hit 5% by the time 2019 rolls around. So when you stop and consider that that’s sixty-one basis points above the current average, it paints today’s rates in a different light.

Rate/Float Recommendation            

Lock in a rate soon

The trend is clear: mortgage rates are moving higher. For many borrowers, this means that the best path forward is to lock in a rate as soon as possible.

Learn what you can do to get the best interest rate possible.

You really don’t want to be in the position where you could have locked in a rate and then they go and spike another thirty basis points in a month. Everyone’s situation has its own set of unique variables but you really have to weigh the risks of holding off on a rate lock.

If you’re not sure what’s best for you, you can always give our mortgage specialists a call or contact us online.

Today’s economic data:                               

Housing Starts

Housing starts for January came in at an annualized rate of 1.326 million. Housing permits came in at an annualized rate of 1.396 million.

Import and Export Prices

Import prices rose 1.0% month over month, putting them at 3.6% year over year. Export prices rose 0.8% month over month, bringing them to 3.4% year over year.

Consumer Sentiment

Consumer sentiment came in at 99.9 for February. Aside from last October, this is the highest reading in 14 years.

Get the GreenLight and close in 21 days*      

Notable events this week:                

Monday: 

Tuesday:    

  • NFIB Small Business Optimism Index
  • Fedspeak

Wednesday:      

  • Consumer Price Index
  • Retail Sales
  • Atlanta Fed Business Inflation Expectations
  • Business Inventories
  • EIA Petroleum Status Report

Thursday:        

  • Jobless Claims
  • Philadelphia Fed Business Outlook Survey
  • PPI-FD
  • Empire State Mfg Survey
  • Industrial Production
  • Housing Market Index

Friday:       

  • Housing Starts
  • Import and Export Prices
  • Consumer Sentiment

*Terms and conditions apply.

Carter Wessman

Carter Wessman is originally from the charming town of Norfolk, Massachusetts. When he isn’t busy writing about mortgage related topics, you can find him playing table tennis, or jamming on his bass guitar.

Source: totalmortgage.com

Apache is functioning normally

Academy Mortgage recently celebrated its 30th anniversary, having been founded back in 1988.

It began as a humble family-owned company opened by Duane Shaw, and remains one today with his son-in-law Adam Kessler in charge, serving as CEO.

With three decades under its belt, it’s clear Academy is a mature player in the mortgage space, which now includes all types of fintech-focused newcomers like Better Mortgage and Movement Mortgage.

It’s a very competitive business, so those who are able to stick out it for so long have proven staying power if nothing else. They must be doing something right, right? Let’s find out.

Academy Mortgage Prides Itself on Doing Everything In-House

  • They are an independent direct mortgage lender based in Utah
  • That only operates via the retail direct-to-consumer channel
  • Licensed to do business in 49 states and DC (not licensed in NY)
  • Have over 260+ branch offices nationwide

The Draper, Utah-based company’s claim to fame is that it’s a direct lender “100% focused on retail mortgage banking.”

What it means is they only work with borrowers directly, instead of dabbling in the correspondent or wholesale channels. So they’re laser-focused on the customer.

Perhaps this is how they were able to navigate through the mortgage crisis that occurred in the early 2000s, only to grow bigger and stronger since then.

Additionally, they do all the loan underwriting, processing, and funding in-house, instead of having a fragmented sales and operations team offsite.

Everything is carried out in one of their 260 branch offices throughout the country. Speaking of, they’re licensed to do business in 49 states and Washington D.C.

Some of those branches were the result of their acquisition of Republic Mortgage back in 2014, which allowed them to grow to 200 branches and 2,100 employees.

In 2017, they also acquired Oklahoma-based First Mortgage Co., which operated many branches in the Southwestern United States and Texas.

They also pride themselves on quick turn times, and refer to themselves as the “Gold Standard” in loan origination.

So it’s obvious that customer satisfaction reigns supreme with the company.

Getting a Home Loan with Academy Mortgage

  • The company employs hundreds of loan officers nationwide
  • You can call them directly to get paired up with an employee
  • Or visit their website and use their online directory to choose someone specific
  • It’s also possible to visit one of their many branches if you prefer face-to-face interaction

The company employs thousands of individuals, including a large fleet of mortgage loan officers throughout the country.

If and when you apply for a home loan with Academy, you can call them directly or choose a specific loan officer to work with.

They have a loan officer directory on their website that allows you to search by zip code, by name, and by branch (city and state location).

I imagine many of the loan officers are referred to clients, either by a real estate agent, or by a former customer who had a good experience with the company.

You can also visit a branch if face-to-face is your thing, though these days folks seem more interested in using a smartphone to make contact.

The one downside here is it appears that you can’t apply for a mortgage online.

Academy Mortgage a Top-40 Mortgage Lender

  • They’re a top-40 mortgage lender nationwide
  • The company closed more than 35,000 mortgages in 2019
  • The majority of those loans were for home purchases (about 70%)
  • With the remainder tied to home refinance transactions and HELOCs

Based on the latest HMDA data, Academy Mortgage was the 37th largest mortgage lender overall in the nation based on total loan volume in 2019.

The company closed 35,000 residential mortgages throughout the year on nearly $9.5 billion in total loan volume.

While that’s fairly big, it pales in comparison to Quicken Loans, which mustered over $81 billion during the same time period. However, it shows they’re no slouch either.

For home purchase loans, they tend to rank in the top 20 nationally since a large share of their mortgages are for that purpose.

For home refinance loans, they rank quite a bit lower due to lower volumes, but they’ve still got plenty of options for borrowers either way.

But it is clear that the independent home loan lender focuses heavily on home purchases as opposed to refinances, likely partnering up with local real estate agents to generate business.

Academy Mortgage Interest Rates

  • They don’t disclose their mortgage rates on their website
  • So it’s impossible to know where they stand without getting a quote first
  • My guess is their rates are average relative to other mortgage lenders
  • If super low they’d probably openly advertise them to draw in business

Unfortunately, the company doesn’t advertise their mortgage interest rates anywhere online. So it’s impossible to know how competitive they are pricing-wise.

If we consider the fact that most of their loan volume comes from purchases as opposed to refinances, we could guess that their mortgage rates probably aren’t super competitive.

Or at least not necessarily lower than the competition. After all, if they had the lowest price out there they’d probably want to advertise it, or at minimum make it known somewhere.

My guess is their rates are run-of-the-mill, but again, that’s just speculation.

If you do include Academy in your mortgage loan search, be sure to compare rates and closing costs to other lenders to see where they stand.

What Academy Mortgage Offers

  • The company offers a variety of home purchase and refinance solutions
  • Including conventional, jumbo, FHA, VA, and USDA options
  • You can get any number of fixed or adjustable-rate products
  • And even a zero down home loan via their exclusive GSFA Platinum Program

The company calls itself a “top-tier lender” when it comes to purchase loans, FHA loans, and builder loans.

This includes home purchase loans, refinance loans, renovation loans, and streamline refinance options.

You can get the basic Fannie Mae and Freddie Mac-backed conventional loans that allow for down payment as low as 3%.

They come in a variety of fixed-rate options, including 30-year, 25-year, 20-year, 15-year, and 10-year terms. That’s typically more choices than most lenders offer.

Academy also offers the usual adjustable-rate mortgage options, including a 10/1 ARM, 7/1 ARM, 5/1 ARM, and 3/1 ARM.

If you’re interested in a government home loan, they offer all the usual suspects including FHA loans, VA loans, and USDA loans, including FHA 203k renovation loans and FHA Energy-Efficient Mortgages.

It’s also possible to get a zero down home loan if you’re a first-time home buyer via their so-called exclusive GSFA Platinum Program, which includes a grant for up to 5% of the loan amount to cover down payment and closing costs.

The grant funds, which are provided by the Golden State Finance Authority, aren’t required to be paid back if certain conditions are met.

Lastly, they offer jumbo home loans up to $1.5 million loan amounts, with down payment requirements as low as 10%.

You may also be able to avoid PMI even when putting just 10% down!

Academy Mortgage Also Offers Commercial Loans

  • While they only operate a retail channel for residential mortgages
  • They do have a commercial lending division as well
  • It offers a very wide range of commercial and small business loans for commercial and multi-family properties

It should be pointed out that the company also offers commercial loans via a separate lending division.

Their offerings range from life insurance company loan programs to Fannie Mae and Freddie Mac programs for apartment buyers.

They also offer conduit loans and conventional loan programs for those wishing to purchase a commercial property.

Additionally, they offer multi-family loan programs, including those backed by the FHA/HUD, along with construction and bridge loans.

Lastly, you can get your hands on a variety of Small Business Administration (SBA) loans, including the SBA 7(a) Program and the SBA 504 Program.

So the appear to have you well covered if you need a commercial loan for just about any purpose.

The Verdict on Academy Mortgage

  • What they appear to lack in technology might be more than made up for by their excellent customer service
  • They have a near-five star rating on Zillow (4.96 out of 5 at last glance)
  • Which is even more impressive based on the many reviews completed (nearly 25,000!)
  • So if you want a great home loan experience they might be a great fit

While they seem to be a good lender on paper, with both high marks on customer service and awards for being a great place to work, we don’t know much about their rates and fees.

For those interested in securing the lowest-cost mortgage, some more digging and comparing will be necessary to see if they’re the right choice.

Academy doesn’t highlight any technology either, which seems to be a major factor these days for a lot of consumers.

There’s no mention of a digital or paperless process, a smartphone app, or anything really on that front. That’s not to say it doesn’t exist, but chances are if it did, it’d be emphasized.

But they’re a top-20 home purchase loan lender, which that says something, especially since they don’t seem to advertise very much.

Perhaps the service speaks for itself, and they receive a lot of referrals from past customers and real estate agents.

They have an excellent rating on Zillow, with 4.96 stars out of 5 on nearly 25,000 reviews at last glance.

(photo: m01229)

Source: thetruthaboutmortgage.com

Apache is functioning normally

It wasn’t until I had children that I really started to think about the products and food I was buying and consuming. 

I wanted to know what I was putting on my babies’ skin and in their bodies. I wanted to know what type of material their tiny little clothes were made from and was contained in their diaper cream and baby shampoo. 

Honestly, this process was illuminating and a bit concerning at times. While I assumed the powers that be are looking out for us in terms of the quality and standards around products and food, I was surprised by some of the ingredients that are considered okay.

Similarly, while it’s nice to think that every company supports adequate working conditions, fair pay, and environmental practices – when I started to do some research I found that this is not always the case.

For me, having children was the catalyst that pushed me towards becoming a more conscious consumer. I really started to think about what I was buying, where it was coming from, and the values of the company I was supporting. And I’m not alone in this. More and more people are moving away from blind consumerism and towards a more deliberate and informed way of consuming. 

Read on to find out what conscious consumerism is, why it’s important, and how you can begin to implement conscious consumer practices into your day-to-day life.  

What’s Ahead:

What is conscious consumerism?

Conscious consumerism is the practice of becoming more aware of your purchase decisions. 

A conscious consumer thinks before swiping a credit card or emptying their Amazon shopping cart. A conscious consumer considers how their spending is affecting society at large with a social, environmental, political, or economic lens.

Simply put, conscious consumerism is about aligning your values with your purchases.  

Why does conscious consumerism matter?

While our individual decisions and behaviors can feel insignificant in the grand scheme of things, just remember that all change starts with the individual. If you want to see more companies thriving that value their employees and the environment, then you need to start supporting these organizations.

Here are a few reasons why conscious consumerism matters at an individual and societal level. 

It promotes change

Conscious consumerism matters because you vote with your wallets on a daily basis. When you buy a product from a company that doesn’t provide fair treatment or fair compensation to their employees or companies that don’t support important social movements, you are supporting those values. Values that you may not agree with. 

If we want companies to change their ways and do better, then we need to put pressure on them. If we continue to buy products from companies that we don’t believe in, then there is no reason for them to change.

And people are voting. In a survey by Empower of 1,000 Americans, 60% of respondents said that they had stopped spending money at companies based on their social beliefs – this was for reasons like not agreeing with their approach to COVID-19 precautions or not agreeing with their political point of view. 

It promotes awareness

Conscious consumerism also promotes awareness. Rather than making blind purchases from companies you know nothing about, the process of becoming a conscious consumer encourages you to dig deeper, to explore your values, and to find companies and products that match them. 

It’s good for you, and others

Conscious consumerism also matters because it’s good for you. As an example, think about buying local, organic food as opposed to unhealthy, processed food. 

Organic food is a conscious choice and a healthier choice. It’s also better for the environment. The same is true when it comes to the clothing you wear or the products that you put on your body. The local, sustainable, ethical products are usually better for you, the employees producing the products, and the environment. 

Can just anyone be a conscious consumer?

The answer to this is a little bit more complicated than you might think. 

In theory, yes. Anyone can become a conscious consumer. All of us can think about what we value and then use the internet to research companies or products that align with these values.  

In practice, it can be more difficult.

Ethically sourced, sustainable products are expensive. The reason fast fashion and fast food are so popular is because they’re affordable. The reason so many celebrities preach the value of “organic this,” and “sustainable that,” is because they can afford to purchase quality items. 

While many people want to eat only organic, locally sourced, and sustainable food, it’s not always a reality because of cost.

It also takes time, effort, and energy to research companies and products that align with your views. People who are consumed with working multiple jobs in order to put food on the table for their family don’t have the luxury of researching each and every purchase.  

Assuming most of us value fair pay, positive social change, and sustainable products, we also value efficiency and convenience. There’s a bit of a tug-of-war between our desire to purchase the products we believe in and the ease and affordability of things like fast fashion. 

How do you implement conscious consumerism ideals and practices in your own life?

While becoming a conscious consumer takes time and effort, there are varying levels of engagement. It’s not an all or nothing deal. You don’t have to be an extremist. You can take baby steps when entering into this practice. 

Here are a few ways you can begin to implement conscious consumerism into your own life. 

Assess your values

First, take some time to think about your values. What matters to you? Are you concerned with the state of the environment and the effects of global warming? Do you want to see the end of child labor? What social movements do you believe in? What kind of clothes do you want to wear? What kind of products do you want to put on your body? What kind of companies do you want to support?

How do you want to vote with your money? Not everyone will be motivated by the same things, and that’s okay. 

Look for Certified B Corporations

If you want to be a more conscious consumer, but you don’t have the time to research every company and product on the market, one thing you can do is look for certified B Corporations. 

Certified B Corporations are businesses that have met standards on social and environmental criteria as outlined by the B Lab. Certified B Corporations are concerned with more than just their bottom line. They care about things like the treatment of their employees and their environmental impact. 

Buy used

One simple way to practice conscious consumerism is to buy used products. By shopping at thrift stores you’re preventing items from ending up in the landfill. 

With online marketplaces like Poshmark and Letgo, it’s never been easier to buy and sell used items.

Buy local

Look to buy local products. When you purchase products locally from small business owners, you have a better chance of getting to know where your food and products are coming from. You’re also putting money into the hands of small business owners as opposed to enormous corporations.

Buying local also means the product doesn’t have to travel as far to get from the producer to you, the consumer. Less travel is better for the environment. 

Minimize consumption

Do you really need another shirt, another hat, a new iPhone, or another pair of shoes? I mean, really? 

Conscious consumerism isn’t just about deciding what companies you want to buy from, it’s also a question of whether you need to buy more. 

Part of being a conscious consumer is evaluating the impact of your purchases. Buying more for the sake of having more, often results in more waste. So, part of being a conscious consumer is knowing when to minimize your consumption. 

Use a water bottle

This is a super simple way to practice conscious consumerism. If you don’t want to add to the insane amount of plastic water bottles in our landfills and oceans then start using a reusable water bottle. It might seem small but it all adds up. Similarly, start using reusable coffee cups, straws, and food containers. 

Become a socially responsible investor

Traditional investing is all about the bottom line. Where you invest is based on what is going to yield the highest value. Socially Responsible Investing (SRI) still aims at making you money but it also takes environmental, social, and governance (ESG) issues into account. 

And, you don’t need to sacrifice returns to invest with a conscience. A study in the Economist reported that sustainable funds outperformed the broader market during a market downturn. 

  • Betterment offers socially responsible investing opportunities.* Betterment believes that you don’t have to choose between value-based investing and working towards your financial goals. They offer SRI portfolios that can help you to invest in your goals while staying true to your values.
  • Empower also offers SRI investing opportunities. They can help you to invest in companies that are managing their environmental, social, and governance issues and they make it easy to add these options to your portfolio. Empower will work with you to determine what investments align with your values whether you are looking for companies that value fair treatment of their employees or companies that care about environmental issues like carbon emissions.

*Higher bond allocation in your portfolio decreases the percentage attributable to socially responsible ETFs.

Research companies before you make a purchase

If you have the time to put into researching companies and products before making a purchase then by all means – do it. It’s all about awareness. The more you know about a company or product, the more confident you can feel that you are supporting a worthy company or removing your business from a corporation that doesn’t deserve it. 

Of course, it can be a challenge to find reliable information, and even when you do locate the details of a product, it can be difficult to interpret (I’m thinking of all the ingredients I can’t even pronounce when it comes to food or beauty products). 

If you want help identifying the environmental or ethical qualities of a company there are a number of different apps you can use such as Agreeable & Co or TradeMade.

What does the future of conscious consumerism look like?

If 2020 has taught us anything, it’s that we can’t predict the future. However, we can make some educated guesses as to where the future of consumerism is headed. 

Minimalism and the sharing economy

Over the past decades, we’ve seen a rise in trends like minimalism, tiny houses, and the sharing economy. 

Plant-based diets

There’s also been a trend towards reduced meat consumption with a rise of vegetarianism and veganism. Think about it, there were no Beyond Burger or Impossible Burgers twenty years ago. 

Socially responsible investing

The investing world is anticipating a similar trend. A 2020 article by CNBC suggests that socially and environmentally conscious investing options will be “the next mega-trend in equities.” 

The article quotes Peter Garnry, Head of Equity Strategy at Saxo Bank who says,

“We believe that these green stocks could, over time, become some of the world’s most valuable companies – even eclipsing the current technology monopolies as regulation accelerates during the coming decade.” 

Increased awareness and action

According to a white paper by Empower, more Americans are becoming more actively involved in regards to where their money is being invested as opposed to leaving it up to a financial advisor. 

This is especially true when it comes to the younger generations. In a survey of over 1,000 Americans, 55% of Millennials respondents reported that they chose the companies they wanted to invest in compared to 39% of Baby Boomers. 

Summary

The first step to becoming a conscious consumer is simply understanding what conscious consumerism is. It’s about understanding what you value and looking for opportunities to support the companies that you truly believe in. This is opposed to shopping blind and making purchases solely based on convenience and price. 

While it’s important to acknowledge that not everyone has the resources to be the consummate conscious consumer, we can all do our part. There are simple strategies like using a reusable water bottle or buying used products. So, if you’re ready to be a more conscious consumer then pick one small strategy and start today! 

(Personal Capital is now Empower)
Empower Personal Wealth, LLC (“EPW”) compensates Webpals Systems S. C LTD for new leads. Webpals Systems S. C LTD is not an investment client of Personal Capital Advisors Corporation or Empower Advisory Group, LLC.

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Source: moneyunder30.com

Apache is functioning normally

Mortgage rates are mostly flat today but they’re higher on the week. Yesterday’s strong Consumer Price Index reading signaled to investors that the Fed might be destined for a faster rate hike schedule than previously thought, which has put upward pressure on mortgage rates. With rates moving higher, we believe borrowers should try to lock in a rate soon. Read on for more details.

Where are mortgage rates going?                      

Rates move higher in the Freddie Mac PMMS

Surprise, surprise: mortgage rates are continuing to climb to new highs in 2018. The latest Freddie Mac Primary Mortgage Market Survey just got released this morning and it’s showing increases all around. Here are the numbers:

  • The average rate on a 30-year fixed rate mortgage moved up six basis points to 4.38% (0.6 points)
  • The average rate on a 15-year fixed rate mortgage ticked up seven basis points to 3.84% (0.5 points)
  • The average rate on a 5-1-year adjustable rate mortgage rose six basis points to 3.63% (0.4 points)

Click here to get today’s latest mortgage rates (Jul. 17, 2023).

Here’s what the Freddie Mac Economic & Housing Research group had to say about mortgage rates this week:

“Wednesday’s Consumer Price Index report showed higher-than-expected inflation; headline consumer price inflation was 2.1 percent year-over-year in January two tenths of a percentage point higher than the consensus forecast. Inflation measures were broad-based, cementing expectations that the Federal Reserve will go forward with monetary tightening later this year. Following this news, the 10-year Treasury reached its highest level since January 2014, climbing above 2.90 percent. Mortgage rates have also surged. After jumping 10 basis points last week, the 30-year fixed-rate mortgage rose 6 basis points to 4.38 percent, its highest level since April 2014.”

That mortgage rates increased after the strong CPI reading was a possibility that we’d warned about over the past few days. This is now the sixth straight week that mortgage rates have moved higher in the PMMS, with the 30-year fixed rate up thirty nine basis points (one basis point = 0.01) from the start of the year.

We’re talking about four-year highs right now. It’s true that every borrower has their own set of unique circumstances that will affect what rate they get, but the average is clearly up a significant amount from the start of the year.

Rate/Float Recommendation            

Lock in a rate soon

With mortgage rates continuing to move higher, we believe that the smart decision for anyone looking to purchase a new home or refinance their current mortgage is to lock in a rate sooner rather than later.

In a span of six weeks, we’ve seen the average rate on a 30-year in the PMMS move up thirty-nine basis points. That is certainly not an insignificant amount.

Learn what you can do to get the best interest rate possible.

When you consider that many analysts are calling for the 30-year to hit 5% by the time 2019 rolls around, current mortgage rates look very appealing. It really only takes a few minutes online or a quick phone call to one of our mortgage specialists to get started.

Today’s economic data:                               

Jobless Claims 

Jobless claims for the week of 2/10/18 came in at 230,000. That puts the four-week moving average at 228,500. It’s another solid report that points toward strength in the labor market.

Philadelphia Fed Business Outlook Survey

The Philly Fed Business Outlook hit a 25.8 for February. That’s a very strong reading that lands outside of even the high range of the consensus. It’s also a few points higher than the prior reading of 22.2.

PPI-FD 

The Producer Price Index ticked up 0.4% in January. That puts it at 2.7% year over year. PPI-FD less food and energy also rose 0.4% month over month, which was higher than expectations, putting it at 2.2% year over year. Keeping with the pattern, PPI-FD less food, energy and trade services also rose 0.4%, month over month, bringing it to 2.5% year over year.

Empire State Mfg Survey 

The Empire State Mfg Survey hit 13.1 in February.

Industrial Production

Industrial production fell 0.1% for January. Manufacturing stayed flat. It’s a weak report, but that was expected, with both readings falling within the consensus range.

Housing Market Index

For the second straight reading the housing market index hit a 72. That’s exactly what analysts had expected.

Get the GreenLight and close in 21 days*      

Notable events this week:                

Monday: 

Tuesday:    

  • NFIB Small Business Optimism Index
  • Fedspeak

Wednesday:      

  • Consumer Price Index
  • Retail Sales
  • Atlanta Fed Business Inflation Expectations
  • Business Inventories
  • EIA Petroleum Status Report

Thursday:        

  • Jobless Claims
  • Philadelphia Fed Business Outlook Survey
  • PPI-FD
  • Empire State Mfg Survey
  • Industrial Production
  • Housing Market Index

Friday:       

  • Housing Starts
  • Import and Export Prices
  • Consumer Sentiment

*Terms and conditions apply.

Carter Wessman

Carter Wessman is originally from the charming town of Norfolk, Massachusetts. When he isn’t busy writing about mortgage related topics, you can find him playing table tennis, or jamming on his bass guitar.

Source: totalmortgage.com

Apache is functioning normally

Search Engine; Co-Issue, TPO, LO Survey, Credit, HELOC Servicing Products; Be Wary of Interest Rate Predictions

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Search Engine; Co-Issue, TPO, LO Survey, Credit, HELOC Servicing Products; Be Wary of Interest Rate Predictions

By:
Rob Chrisman

Thu, Jul 13 2023, 10:38 AM

As rumors continue to swirl regarding the purchase of a well-known Southeastern Texas mortgage bank, lenders are watching the current drop in rates. It is generally believed that a slowing economy, aka a recession, leads to lower rates. Some have been predicting a recession for a few years, and it becomes a little tiresome, especially with the Fed continuing to focus on inflation. At some point, there will be agreement that things have slowed (like small business optimism is now) and they’ll be right. Meanwhile, it is hard to have a recession when the labor market, housing prices in much of the nation, consumer spending, and credit availability, remain as strong as they are. At this point rates probably won’t drop much in the near future, and vendors and lenders can’t sit there, wringing their hands, waiting for things to get better on their own. Are lenders suddenly going to make huge margins on lots of volume in the second half? Are LOs who were doing 2-3 loans a month in the first half suddenly going to do 4-6? Are vendor reps suddenly going to double their clients? Are rates going to plummet? Is the number of houses for sale going to skyrocket? (Today’s podcast can be found here and this week’s is sponsored by SimpleNexus, the homeownership platform that unites the people, systems, and stages of the mortgage process into one seamless, end-to-end solution that spans engagement, origination, closing, incentive compensation, and business intelligence.)

Lender and Broker Software, Services, and Products

The MBA defends mortgage servicers…. In response to audit reports recently published by the HUD OIG, Bob Broeksmit, MBA president and CEO, spoke out in defense of mortgage servicers. As the HUD OIG looks at areas of “failure” that occurred in handling loss mitigation and COVID-19 forbearance, Broeksmit points out this is due to “never-before-seen volume”. It is possible to rise above the problems of the past, scale effectively, and overcome industry obstacles. CLARIFIRE®’s “Conquering Record-Breaking Change” blog lists the points of failure identified by the HUD OIG and the solutions you need to prepare for the future. It’s time to act on how you use the experiences of the past to ensure readiness by implementing proven modern, intelligent, seamless process automation software. CLARIFIRE® is Truly BRIGHTER AUTOMATION®.

“I am looking to sell my Vendor Surf search engine platform! After more than 5-years of an immensely gratifying journey, Vendor Surf is being retired. Having just successfully navigated a major cancer battle, life’s priorities have never been clearer. Sadly, my seemingly undying passion for the vendor marketplace has met its match. Life awaits! I offer my sincere thanks and gratitude to our superb client base, as well as those that listened to our story and read our content over the years. Ours is a special industry. Scott Roller (FYI, we have enlisted a liaison to market the search engine platform for purchase, transferrable to any global industry. It can be re-skinned and launched as fast as you can define your search filters. Email me.)”

Rising interest rates and inflation causing a dip in originations? Maximize your portfolio reach with HELOC options designed to help your customers tap into their home value to remodel kitchens, fund education, and more. LoanCare has a comprehensive understanding of the special nuances involved in servicing HELOCs such as knowing what’s required to appear on monthly statements, ensuring that interest calculations are accurate, and setting up the HELOCs correctly when the loans are on-boarded. We can accommodate segmented, fully amortized, and interest only HELOCs. Contact LoanCare today!

The digital online retail revolution has taught us that speeding up processes and increasing visibility can bring tremendous benefits. That’s exactly why Equifax is delivering Telco, Pay TV and Utilities insights alongside our traditional mortgage credit report. With a better view of 191 million potential homebuyers, you can help lenders automate and streamline their underwriting process, save costs, and build a better consumer experience. And just as importantly, grow your business. Ready to make inefficient mortgage lending a thing of the past? Learn more about the solutions and latest news from Equifax Mortgage and Housing.

“Hey there lenders, how important are surveys in your mortgage origination process? Maybe you use them to collect needed info from borrowers? Or to get client feedback and reviews once the loan is closed? Have you ever wanted to send surveys straight from your LOS? Velma wants to know and is conducting a quick 3-minute survey to find out how mortgage pros, just like you, are using surveys in their day-to-day operations. (Plus, if you’re interested, we’ll share the results with you…) Take the Velma Connector Survey on Surveys Today!”

TPO Channels for Lenders and Brokers

AmeriHome Correspondent, backed by the strength and stability of Western Alliance Bank, continues to grow market share in the correspondent space. When you combine AmeriHome’s industry leading loan purchase platform with Western Alliance Bank’s warehouse lending and treasury management services, this is one “must-have” relationship for mortgage bankers of all shapes and sizes. IMBs and financial institutions alike benefit from AmeriHome’s Delegated and Non-Delegated options, full suite of conventional and government products, and Bulk, Bulk/AOT and Best-Efforts delivery options. They are currently running a pricing special for Purchase loan amounts of $200,000 or less and offer a stable of temporary rate buy-down options. Catch them in August at the Colorado MLA Annual and the Western Secondary Conference or check out their Upcoming Events page for details on where they’ll be this summer! Find your local sales rep here or send them an email to learn more about the advantages of partnering with AmeriHome.

“The 3rd quarter of 2023 is already upon us, and Newrez Wholesale is excited to reveal our 2nd Quarter RezClub qualifiers next month. One of the many reasons for being a RezClub member is our non-solicitation protection of your business through RezConnect. Get in RezClub and get protected! To learn more, click here or call your AE for details. Here are just a few reasons why you should send Newrez-serviced borrowers back to us: A 1/8th price improvement, the ability to net escrows, saving your borrower cash out of pocket at closing (on same property refinances), priority service and faster turn times, and ease of transaction: We already know your borrower. These benefits apply to any new loan transaction in good standing, whether that’s a purchase of a new home or a refinance of another property. We want to be your partner of choice for new and repeat business, and we’re serious about retaining your borrowers.”

Interest Rate Predictions: Keep Them in Perspective

I am asked all the time, “Hey Rob, where do you think rates will be in six months?” My answer, after I say that I can’t even predict where I’m going to have lunch tomorrow, is always the same, “Higher, or lower, or possibly the same.” Or sure, one can have a prediction until a ship becomes stuck in the Suez Canal, or a pandemic occurs. STRATMOR’s current blog is titled, “Interest Rates are Like the Weather? Or Like Signs of the Zodiac?”

For some outside input I asked James Hedvall, grizzled capital markets veteran. He replied, “The interest rate markets have a way of humbling almost all the ‘experts’ and the very first thing you learn in Secondary Marketing is that you shouldn’t take a view on where rates are headed because half the time, you’re wrong anyway. In Q4 last year the arm-chair prognosticators were predicting that we’d see rates come down by the end of 2023, however, that simply does not appear to be the case as many LOs are originating in the 7% range currently.

“The Federal Reserve, in its attempts to control inflation and cool a very strong economy, have raised Fed Funds three times just in 2023 alone, with another 25-bps increase predicted for July’s meeting, and a window left open for another increase before the end of the year. I continue to read, however, inside the world of mortgage banking, opinions expressed that rates will not only come down, but when to expect this to happen. Based upon what data, I ask? Are their views speculative, biased, or just hopeful?

“I would challenge these prognosticators as to ‘why’ mortgage rates are positioned to fall. What leads them to predict that? I’m sure some opinions are based on fundamentals: Fed raises rates to control inflation, money is taken out of the economy, the economy cools, Fed cuts rates, and mortgages come down to some predicted level. A lot of the predictions I see are not rooted in actuality, but rather rooted in exuberance for mortgage banking.

“Here’s some additional perspective. None of the macro data even hints at a reduction of short-term interest rates. Current inflation is a tad north of 4% with the Federal Reserve’s target set at 2% Economists have modeled that unemployment would need to reach as high as 7% in order for inflation to come down to 2%; however, June’s unemployment report had very little change from May’s with the current rate at 3.6% Remember, when an economy ‘slows’ jobs are not created, historically they’re lost.

“Everything points to the Fed being hawkish in its monetary policy for the remainder of the year. Anyone predicting where interest rates will be in the future would need to start by predicting where the Federal Funds rate NEEDS to be in order to see inflation that’s appealing to the Fed, and then ultimately, HOW LONG rates needs to remain there; when is it warranted to reduce borrowing rates under recessionary fears? These are two almost impossible questions to answer since the number of variables that you need to get right, coupled with unpredictable world events, play such a strong role in forecasting interest rates.”

Like I said before, a year from now, rates will either be higher, lower or the same. So let’s discuss your products and services!

Capital Markets

As the market moves through different cycles, lenders are continuously evaluating whether to retain or release mortgage servicing rights (MSR) as part of their overall strategy. MCT & Mr. Cooper released a whitepaper, Getting Started with Co-Issue Transactions, that reviews the basics of co-issue transactions, helps dispel common MSR myths, and explains how to incorporate various strategies to achieve your business objectives. If you’re interested in co-issue executions, MCT’s BAMCO offers expanded execution options for sellers while providing new client acquisition options for buyers, creating a more convenient way to conduct co-issue transactions. BAMCO provides sellers with the ability to incorporate co-issue pricing from MSR buyers on the platform into the best execution analysis, regardless of approval status. Learn more about how MCT’s Marketplace is maximizing liquidity, eliminating barriers, and optimizing execution.

For those hoping for lower rates, yesterday’s report on the Consumer Price Index for June brought good news. Headline consumer price inflation cooled versus May, increasing just 0.2 percent over the month and 3.0 percent over the past year, the slowest rate in more than two years. Excluding food and energy prices, the core CPI increased 0.2 percent over the month, the smallest monthly increase in core inflation since February 2021. Consumer-price inflation is now just one-third of the level it reached a year ago, good news for consumers, the markets, and the Fed. The report likely isn’t enough to stop the Fed from going ahead with its well-signaled interest rate hike this month (92 percent probability) after the June jobs report showed wage increases still running hot, but it raises doubts about whether more hikes will be forthcoming. The implied likelihood of another increase in November fell to 26.8 percent from 42.4 percent on Tuesday.

Inflation has been moderating on the heels of severe tightening by the Fed, but core-inflation printed at 4.8 percent in June, still a far cry from the Fed’s 2 percent target. Speaking of the Fed, yesterday it released its Beige Book for June describing overall economic activity as having increased slightly since the May report. Five Fed Districts saw slight or modest growth while five saw no change and two reported slight declines. Consumer spending was mixed with some pressure on discretionary spending. Tourism was robust and demand for hospitality services is expected to remain strong during the summer. Auto sales were little changed while manufacturing improved in six Districts and weakened in the other six. Lending softened but demand for residential real estate remained solid. Employment increased modestly while growth in prices was also described as modest. Related to inflation, the report said, “price expectations were generally stable or lower over the next several months,” and “some Districts noted reluctance to raise prices because consumers had grown more sensitive to prices.”

Today’s economic calendar kicked off with two key economic releases: jobless claims (237k, lower than expected) and wholesale inflation for June (+.1 percent versus expectations of +0.2 percent month-over-month and 0.4 percent year-over-year). The other primary event for the market is the final leg of the mini-Refunding consisting of an auction of $18 billion reopened 30-year bonds, though markets will also receive remarks from San Francisco President Daly and Board Governor Waller. We begin the day with Agency MBS prices better by .125, the 10-year yielding 3.83 after closing yesterday at 3.86 percent, and the 2-year, which a week ago was north of 5.10, is at 4.66 after the producer price numbers.

Employment

Evergreen Home Loans™ is committed to its GROWTH conviction. One way is by positioning loan officers for success, beginning with its VIP onboarding experience. “Our onboarding team is amazing,” said Loan Officer and Branch Manager Amber Page. “They walk right beside you to make sure you are all plugged in with the right passwords and system setups. Makes you feel like you have a friend right from the start at the company.” Evergreen also invests heavily in digital mortgage technologies, offers product training and business coaching opportunities, and develops innovative programs to answer current and future market challenges, among other things. And not only do these advantages support loan officer growth, but they also help win business for agent partners. Loan officers looking to experience feeling supported in professional growth can explore current opportunities on the Evergreen careers page.

“Planet Home Lending is defying the odds and achieving remarkable retail growth. Halfway through one of the industry’s toughest years, we’ve welcomed more than 100 MLOs. Our response to the challenges of shrinking volume, constrained margins, and market unpredictability was to build a foundation for growth. You can expect financial stability, operational sophistication, approachable leadership, and unwavering multichannel support, along with competitive pricing to help you reach more borrowers and close more loans. To thrive in an ever-evolving market, reach out today for a confidential discussion with Brian Miller, Planet’s SVP Talent Acquisition, at 214-223-9986, or Peter Briggs, VP Talent Acquisition, at 949-202-8213.”

 Download our mobile app to get alerts for Rob Chrisman’s Commentary.

Source: mortgagenewsdaily.com

Apache is functioning normally

After a push higher on Monday, stocks, bond yields, and mortgage rates are easing back a little on Tuesday. Market participants are still largely in a wait and see mode ahead of Wednesday’s key Consumer Price Index Report.

With inflation data remaining in the spotlight, that reading has the potential to send current mortgage rates one way or another. Read on for more details.

[embedded content]

Market Outlook 2.12.18 from Total Mortgage on Vimeo.

Where are mortgage rates going?                      

Rates down a little today

It was a strong start to the week on Monday with all of the major stock indexes moving higher. With long-term Treasury yields being sold off, we saw yields rise to multi-year highs.

Click here to get today’s latest mortgage rates (Jul. 16, 2023).

Of particular importance to mortgage rates is the yield on the 10-year Treasury note, which moved as high as 2.89% on Monday. That’s a big rise from where it was at the start of the year at 2.46%.

Mortgage rates typically move in the same direction as the 10-year yield, and as we saw in the most recent Freddie Mac Primary Mortgage Market Survey, the average rate on a 30-year fixed rate mortgage has moved up thirty three basis points since the start of the year.

The general consensus among market analysts is that bond yields and mortgage rates still have room left to run. How high they will rise in 2018 is an ongoing debate, but we have seen several calls for the 30-year fixed rate to hit 5% by the time 2019 rolls around.

That’s not something that will happen overnight, but we are still dealing with the threat of rising rates this week. Tomorrow, we will get the Consumer Price Index reading for January–a key inflation reading that financial market participants will certainly have their eye on.

We haven’t seen much uptick for CPI in recent months, but that only increases the potential for a big market reaction if we see some unexpected growth.

After all, one of the leading theories for last week’s stock market decline was the jump in average hourly earning in the monthly job report for January, signaling to investors that inflation was picking up.

So what would happen if CPI comes in higher? Well, it’s easy to imagine a similar scenario as last Monday with stocks falling and bond yields and mortgage rates surging.

It’s definitely a wait and see game, with no clear outcome readily visible. The CPI report will be released at 8:30am tomorrow morning and the market reaction, if there is one, will happen swiftly after the release.

Federal Reserve on track to raise rates in March

Cleveland Fed President Loretta Mester spoke this morning to the Chamber of Commerce in Dayton, Ohio, stating that she is not overly concerned about the U.S. stock market’s recent stumble. She said, “I expect the economy will work through this episode of market turbulence and I have not changed my outlook.”

That means that she’s still planning on raising the federal funds rate by about three-quarters of a point in 2018. Mester did throw in the caveat that she would have to readjust her outlook on monetary policy if the data starts to come in differently.

Overall, it still seems like the Fed is poised to raise the federal funds rate for the first time in 2018 at their March meeting next month.

Rate/Float Recommendation            

Lock now to avoid risk of rising rates

Mortgage rates have been steadily rising throughout 2018. There is the definite risk that they will rise tomorrow when we get some key inflation data. If you want to avoid the risk of rising mortgage rates, your best bet is to lock in a rate now.

In the current rate environment, opting to float could mean that you’ll get a higher mortgage rate down the road. If that’s something you can stomach, then by all means do it, but just understand there is a clear risk involved.

Find out how to get the best rate possible with our in-depth video series. 

Today’s economic data:                               

NFIB Small Business Optimism Index 

The NFIB Small Business Optimism Index hit a 106.9 in January. That’s an increase from the prior month’s reading of 104.9.

Fedspeak  

  • Loretta Mester at 8:30am

Get the GreenLight and close in 21 days*      

Notable events this week:                

Monday: 

Tuesday:    

  • NFIB Small Business Optimism Index
  • Fedspeak

Wednesday:      

  • Consumer Price Index
  • Retail Sales
  • Atlanta Fed Business Inflation Expectations
  • Business Inventories
  • EIA Petroleum Status Report

Thursday:        

  • Jobless Claims
  • Philadelphia Fed Business Outlook Survey
  • PPI-FD
  • Empire State Mfg Survey
  • Industrial Production
  • Housing Market Index

Friday:       

  • Housing Starts
  • Import and Export Prices
  • Consumer Sentiment

*Terms and conditions apply.

Carter Wessman

Carter Wessman is originally from the charming town of Norfolk, Massachusetts. When he isn’t busy writing about mortgage related topics, you can find him playing table tennis, or jamming on his bass guitar.

Source: totalmortgage.com