Santos's Blog

TGIF - UGLY Jobs Report decreases mortgage rates

Santos Sanchez (FAMILY HOME LOANS) — Fri, 04 Apr 2008 09:41:58 -0500

The March Jobs Report is in - a whopping 80,000 jobs were lost in March making it the worst report in 5 years. The unemployment rate ticked up from 4.8 to 5.1% and projections were at 5.0%. Because of this negative news, bonds are currently up +44 basis points. The rate for a No Money Down, 30-year fixed Loan Amounts over $170k is 5.75%.

Have a GREAT weekend.

Santos

Quoting Mortgage Rates.........Now You See It...Now You Don't

Santos Sanchez (FAMILY HOME LOANS) — Mon, 31 Mar 2008 18:01:11 -0500

Have you ever been involved in a bidding war on Ebay and you're getting down to the last minute of bidding........you have the best bid.....and just when you're about to win the product.......you accidentally kick your plug and your computer shuts off. "NOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO!!!!" is what your kids hear as you're screaming your head off. You frantically sign back on the computer and that pain-in-the-rear that you were at war with won the product....by bidding a penny over your last bid!

I Welcome You to the Mortgage Interest Rate world.

I received an email from one of my past customers saying, "Santos, I heard mortgage rates went down to 5.25% and are going lower." Seeing as my best rate for the past couple of days has been 5.75% with no points, I just had to chuckle.

There used to be day when a rate sheet was good for a whole day and sometimes two or three days. Those days seem like only a dream. There are days when bonds start off in a good mood and rates decrease on the first rate sheet. Then positive stock market news is released and bonds take a dive. Then the stock market loses steam and close out on a negative note. That's when things get really crazy when trying to quote an interest rate to a customer.

My point - make sure your Loan Officer has the technology to be up to date on mortgage rates. A 1/4 percent higher rate could be the difference between a loan approval and loan denial.

Have a fantastic day!

Santos

So Where is the Foreclosure Capital of the U.S? Drum Roll........

Santos Sanchez (FAMILY HOME LOANS) — Mon, 28 Jan 2008 13:21:17 -0600

.....believe it or not, it's NOT Michigan. I keep telling my agents, "as bad as it seems here, there's always something worse out there!" So hang in there folks....it WILL get better!

Below is the link from a 60 MINUTES story on the Foreclosure Capital of the U.S!

(Cut and paste this link into your browser if you can't click on it)

http://cosmos.bcst.yahoo.com/up/player/popup/index.php?cl=6124486

Have an AWESOME day!

Santos

THE MORTGAGE AND REAL ESTATE BUSINESS IN MICHIGAN - Take what we used to know.....

Santos Sanchez (FAMILY HOME LOANS) — Fri, 25 Jan 2008 14:27:01 -0600

.....AND THROW IT IN THE TRASH!!!

I have been in the mortgage business for 9.5 years now and I feel like a brand new Loan Officer.

In the state of Michigan, Fannie Mae has ruled that MOST of our state is considered an area of "declining markets." They say MOST of the state of Michigan is but I haven't ran across a zip code that ISN'T. So the days of No Money Down programs in Michigan in the Conventional Loan world is gone. Yes, the lenders offer them but Fannie Mae is saying that if a home is in an area of declining markets, the customer MUST put 5% down. So in Michigan, the only way you're going to purchase a home with No Money Down is with an FHA loan with Down Payment Assistance (FHA does not have the 'declining markets' issue).

So sharpen your FHA pencils, Michigan agents....because that's going to be the trend. Keep in mind that we still have to pay attention to the FHA Maximum Loan Limits per county. To check the maximum Loan Limits, follow this link: https://entp.hud.gov/idapp/html/hicost1.cfm

Because there are A LOT of deals that are coming in on Foreclosure Homes, be VERY careful of any safety issues that might come up in the appraisal and talk about them to your potential buyer. What we are finding is that the foreclosing bank will NOT pay for any necessary repairs so it becomes the responsibility of the buyer to fix any issues. I had a deal where the previous owner took all or most of the light fixtures and the wiring was exposed. The lender was requiring that the hazard was remedied BEFORE the closing and that threw everyone for a loop. But save yourself from any potential headaches....take a little more time in the beginning and it'll save you a lot of headache in the end.

In today's market, the appraisal will make or break a deal regardless if you have a buyer with 700 credit scores. So again....what we used to know.....throw that out the window.

I was talking to a friend of mine that loves going to the casino about the market and I could only give the following analogy in order to explain how the lenders are reacting:

You take the last $500 you own to a casino. The first $1 you put in and lose, you really aren't worried yet. $20 is lost and you're still not worried. When you have lost $450 of the $500 and you haven't won anything yet, you start to get worried and really start considering other options. When you get down to your last $10, you really want to KNOW that one of those last dollars is going to perform before you put it in the machine. Well, we have seen many lenders have gone under because they spent their last $10. The ones that are still out there are on their last $10 so they want to KNOW that their loans will perform.

In other news, bonds are having a favorable day after losing -144 basis points over the past few days. So time and time again, news of the Fed's Fed Funds/Discount Rate does not really translate into lower mortgage interest rates. As of today, we could offer a 30-year fixed at 5.50% for purchase transactions over 170k with credit scores over 680.

Have a GREAT weekend!

Santos

Mortgage Market Guide as of Wednesday, January 16, 2008

Santos Sanchez (FAMILY HOME LOANS) — Wed, 16 Jan 2008 12:04:16 -0600

GOOD WEDNESDAY AFTERNOON!

No lack of volatility in the market today! Mortgage bonds opened up relatively flat at -3 basis points and over the last few minutes, they have dropped down to -16 so we may see a little bit of a rate increase. As of this morning's rate sheets, we could've squeezed a 30-year fixed in at 5.50% for purchase transactions over $170k with 5% down. With what's happening as of now, we might see them trickle back up to 5.625%.

In other news:

This morning's CPI (Consumer Price Index) numbers came in better than expected at 2.4% so this looks like it's contributing to the dent in mortgage bonds. At 2:00 today, the Fed's Beige book (report of the country's economic conditions) will be reported.....so this could be a bond market mover as well.

100% Financing - As you know, it's getting harder and harder to get these loans - not only because of credit score requirements, but now because Fannie Mae has declared most of Michigan an area of declining markets. When we run a loan through Automated Underwriting, whether it be through Fannie Mae or Freddie Mac's system, we get an approval or a decline. If the loan is approved, it gives us a report of the information that we need to submit in order to turn it into a final approval (a pay stub, W2, etc). Before in the collateral section, it was just indicate that we need an appraisal with outdoor and indoor photos. Now, Fannie Mae is putting a blurb that resembles "this address appears to be in an area of declining values." If that is the case, the borrower will HAVE to put 5% down. Again, it's not anything to do with the borrower's qualifications - it's the home itself and how Fannie Mae is categorizing it. For a very brief window, we were running loans through Freddie Mac's AUS because they weren't putting that blurb on their approval letters. Starting today, some lenders are no longer accepting the Freddie Mac approvals. So again...this market is ever-so-changing! If this completely goes away, you will have to start sharpening your FHA with Down Payment Assistance programs pencils in order to do a No Money Down program. I would be happy to walk you through the process - it is actually very easy.

If you need anything...I'm here!

Have a GREAT day!

Mortgage Market Guide as of Wednesday, November 21, 2007

Santos Sanchez (FAMILY HOME LOANS) — Wed, 21 Nov 2007 12:30:17 -0600

THE ELASTIC WAISTLINE PANTS ARE READY FOR TOMORROW!!!

Volatility continues in the Bond Market. Currently, bonds are up a whopping +38 basis points so we're enjoying this news. As of today, we are offering 30-year fixed at 6.375% with NO points and we will advise to "float" your interest rate to see if further gains come our way.

Yesterday, Mortgage Bonds opened lower, hovered on an support floor of support throughout the day before dropping sharply right before the market close. Unfortunately, we heard of some lenders re-pricing early in the day, which is unusual in advance of the release of the Fed Meeting Minutes without a significant move in the market. Thankfully we have had a great ride on the Up Escalator, which provided significant gains. But, we apologize if your lender had re-priced prior to the alert. We always strive to be ahead of lender moves and assure you that we will continue to do our best.

Yesterday, it was also interesting to see the divergence between Mortgage Bonds and the Ten-Year Note. At one point in the day, the Ten-year Note was trading 12bp HIGHER and Mortgage Bonds were 22bp LOWER.

Also yesterday, the Fed Minutes and Forecasts were released. There were no surprises, but the Fed did forecast lower inflation ahead, which is good news for Bonds in the longer term. Additionally, there was some talk that indicated some Fed members feel the Fed should not cut rates at the Dec 11th Meeting. However, the forecasts for lower inflation, slower economic growth and slower job growth all suggest that there may indeed be another rate cut in December.

Stocks are getting hammered lower and from a technical standpoint are looking pretty bad. Each of the three major stock indices, the Dow, NASDAQ and S&P 500, are trading beneath their 200-day Moving Average. As long as Stocks continue to struggle, Bonds may be the beneficiary as money flows out of Stocks and into Bonds.

Technically, Mortgage Bonds remain on the Up Escalator and this morning's rebound higher has popped prices back above yesterday's floor of support. With prices still enjoying the nice uptrend we will continue to float longer-term transactions, but be mindful of the extreme volatility and itchy trigger fingers some lenders are showing. This means that if you have transactions closing in the next couple of weeks, you need to pay closer attention to the quick daily changes in pricing. However, with transactions closing 30 days out or more, it is wise to watch the long-term uptrend in price we are seeing. In either case, should prices step off the Up Escalator as we have seen in the past, we will quickly change to a locking stance across the board.

On behalf of John Adams Mortgage and myself, Have A Very Safe and Happy Thanksgiving Day!

Santos

Mortgage Market Guide as of Tuesday, November 20, 2007 -- Mortgage Rate Increase

Santos Sanchez (FAMILY HOME LOANS) — Tue, 20 Nov 2007 16:55:42 -0600

LOCK 'EM IF YOU GOT 'EM!

Welcome to our roller coaster ride! Yesterday's update ended with a "floating" stance because bonds closed out the day at +25 points....so, of course, we thought rates would get better. Right out the gate this morning, bonds opened up at roughly -22 basis points so they woke up on the wrong side of the bed. Throughout the day, they deteriorated even more and closed out the day at -34. Although none of our lenders issued a rate increase, we do expect the increase to hit tomorrow. So if you have overnight protection..........lock 'em if you got 'em!

Why all the commotion? The Fed 'hinted' in their meeting minutes that they would cut rates again and, as history has proven, mortgage bonds react negatively. So monies pulled out of bonds and filtered into stocks. So we'll see what tomorrow brings.

As of the close the day, we are offering 30-year fixed mortgages at 6.50%.

On a warmer note.......can you smell the turkey already?!?!?/ :)

Make it a GREAT night!

Santos

Mortgage Marked Update as of Monday, November 19, 2007

Santos Sanchez (FAMILY HOME LOANS) — Mon, 19 Nov 2007 14:54:15 -0600

2 MORE FULL DAYS BEFORE THE BIG 'STUFF YOURSELF TILL YOU CAN'T STUFF NO MORE' DAY!

I, for one, will be hitting the gym extra hard this week in anticipation of Thursday's feast! Is it bad when you're working out and you're thinking of what you're going to eat later on that day? hahahah :)

OK...now to business.....

The big news was from this morning - Goldman Sachs downgraded Citigroup to a "Sell" from a "Hold", saying that Citi could have to write off an additional $4 Billion due to sub-prime mortgage related losses. This announcement has applied pressure on Stocks, which in turn has boosted the Bond Market slightly higher.

Tomorrow at 2pm ET, the new and improved, "more transparent" Fed is slated to release the first of its new economic forecasts as well as the Minutes from its October Meeting. The new quarterly forecasts from the Fed will include their projections on Overall and Core Personal Consumption Expenditure, Real Gross Domestic Product and the Unemployment Rate. The Minutes and forecasts could have an impact on the market tomorrow, especially as Traders look to handicap the December 11th Fed meeting for direction on whether the Fed will cut or not.

Mortgage interest rates are still at 6.375% for a 30-year fixed with no points and the bond market looksl like it will close on a positive note.....so today's stance is a "floating" stance. If anything changes, I will let you know.

In observance of the Thanksgiving Holiday, the Bond market is scheduled to close early this Wednesday and Friday at 2:00pm ET with a full-day close on Thursday.

Make it a GREAT day!

Santos

TGIF! Mortgage Market Update for Friday, November 16, 2007

Santos Sanchez (FAMILY HOME LOANS) — Fri, 16 Nov 2007 15:40:34 -0600

TGIF!!!!!

Well, it's the Friday before the Thanksgiving holiday so I think I can officially turn my holiday lights on outside :) Oh you just KNOW I had them up last weekend! I just thought it was a little early for me to turn them on.....but now....I'm good! :)

Closing out the work week.....

On the economic front, Industrial Production and Capacity Utilization, which measure the change in industrial output, were reported close to expectations and remain a bit below levels consistent with inflationary pressure.

Mortgage Bonds have been experiencing a little bit of an upward trend and we have been giving a "floating" stance. However, closing out the day, mortgage bonds have dipped down to -21 basis points. As a reminder, when they drop below -16, we usually see an intraday rate increase. I saw the stock market bounced back a little bit today so it's taking a toll on bonds. I am ultra conservative and definitely not a gambler so I have suggested that my pipeline lock today - better safe than sorry!

As of 4:40 pm today we are offering a 30-year fixed at 6.375 with NO points.

Have a GREAT weekend!

Santos

Mortgage Market Update as of Thursday, November 15th

Santos Sanchez (FAMILY HOME LOANS) — Thu, 15 Nov 2007 13:17:31 -0600

GOOD THURSDAY AFTERNOON!!!

ONE MORE WEEK TILL THANKSGIVING?!?!?!?!?? How this year is flying by!

I hope everyone is having a FANTASTIC day. Yesterday's temperature was a beautiful 55'ish...and today is a cold, rainy, snowy mix at 30 degrees. WELCOME TO MICHIGAN!

Mortgage Bonds are trading higher, currently at +19 basis points, after this morning's inflation report. The Consumer Price Index (CPI) reported that inflation is inline with expectations. However the Core CPI, which strips out food and energy, was reported at 2.2%--up from 2.1%.

Typically, higher inflation is a negative for Bonds. But in this case, Mortgage Bonds improved because Traders viewed the higher Core CPI as a potential reason for the Fed to hold off on another rate cut. This initially led to Stock sales with the proceeds moving into Bonds--which has helped Bond prices move higher.

For now, I will continue to float as bonds enjoy the improved pricing. Seeing as bond prices have increased higher than the "rule of thumb" +16 basis points, we may see rates go down. As of today, we are still offering a 30-year fixed at 6.50% with NO points.

Make it a GREAT day!

Santos

TGIF! Mortage Market Update as of Friday, November 9th

Santos Sanchez (FAMILY HOME LOANS) — Fri, 09 Nov 2007 12:32:03 -0600

TGIF!!!!

Surprise, surprise...more sub-prime mortgage related losses are hitting the financial sector this morning. Stocks are trading lower and Bonds are trading slightly higher after Wachovia Corp announced a loss of $1.1 Billion in the value of their Collateralized Debt Obligations (CDO's). CDO's are investments partly comprised of subprime mortgages, and as subprime mortgage default rates have risen, the values of these CDO's have fallen significantly.

And because Stocks are again to the downside Bond prices are being supported as proceeds from sold Stocks get parked into Bonds. Both the Dow and S&P 500 benchmark indices have just broken below their 200-day Moving Averages. Unless they can recover, this could mean that Stocks could move much lower, which would help Bond prices.

In other economic news headlines, the US Balance of Trade for September narrowed to a deficit of -$56.5 Billion. This was slightly smaller than expectations and actually the lowest trade deficit in more than two years. A surge in exports due to our weak Dollar is responsible, as foreign buyers can more readily afford our US produced goods and services, as their own currency simply goes further against our weakening Dollar. While a lower trade deficit is good news for our economy - the weakening Dollar continues to be a concern, as it is inflationary, and bad for Bonds longer term.

Bond prices are continuing to dance around a floor of support; however, should Bond prices drop below these important floors, we will quickly switch to a Locking stance and you will be hearing from me. As for now, I suggest to float any interest rate locks for now.

Our rate for a 30-year fixed still remains at 6.50% for a 30-year fixed mortgage, no points.

Holiday Announcement - Veteran's Day

The bond market will be closing early today at 2:00pm ET and will be closed the entire day on Monday for observance of Veteran's Day. Our next Morning Update will be published on Tuesday, November 13.

Have a GREAT weekend!

Mortgage Market Update as of Thursday, November 8th

Santos Sanchez (FAMILY HOME LOANS) — Thu, 08 Nov 2007 15:55:31 -0600

HAPPY THURSDAY AFTERNOON!!!

Fed Chairman Ben Bernanke is testified this morning before the Congressional Joint Economic Committee on the U.S. economic outlook and bonds took a little bit of a hit. We started the morning at +9 basis points and it looks like we'll close the day out at -3 basis points but still no cause for alarm.

Also in today's economic news headlines, Initial Jobless Claims were reported lower than expectations and are at their lowest reading in a month. And at 1 p.m. there was a $5 Billion Treasury auction in 30-year Bonds. This didn't seem to have a huge impact on bonds either.

With no huge changes in bonds after today's reports, I am going to advise to cautiously float interest rates. As of today, we are still offering a 30-year fixed at 6.50% with no points.

Enjoy the rest of your day!

Santos

Hello from Michigan!

Santos Sanchez (FAMILY HOME LOANS) — Wed, 07 Nov 2007 15:45:32 -0600

Hello All!

I just found the group so I thought I would pop in and say, "hello." I hope everyone is having an awesome Wednesday! For updates on the mortgage market, please feel free to visit my page as I update it every day (well, I try to!).

Make it a GREAT day!

Santos

Mortgage Market Update as of Wednesday, November 7th

Santos Sanchez (FAMILY HOME LOANS) — Wed, 07 Nov 2007 15:36:47 -0600

GOOD Hump Day TO ALL!

Bonds are closing out today flat, currently at ZERO, so there wasn't a change in mortgage rates today.

Stocks were punished this morning. Leading the way down was a nasty earnings report from General Motors (GM), who announced a shocking third quarter loss of $39 Billion, which included significant mortgage related losses generated by GMAC, GM's former financial company.

The big news of the morning was China announcing they may diversify their holdings away from the US Dollar. Statements from Chinese officials included "We will favor stronger currencies over weaker ones, and will readjust accordingly. The US Dollar is losing its status as the world currency." As you know, we have anticipated this happening for a very long time, and have reported our thoughts on this to you in many prior Updates and seminars. For China to reduce its massive US Dollar denominated holdings, they must sell off some of their enormous US Dollar based positions, like our Mortgage Bonds. Going forward, they also may not purchase as many of our Mortgage Bonds. The massive demand for our Bonds by the Chinese is one reason rates have stayed relatively low in recent years - so this scenario is not good for Bonds and home loan rates in the long term.

Additionally, Oil is now trading near $98 a barrel and this also won't be good for Bonds longer-term as high energy prices are inflationary. We are watching Oil as it approaches a psychological resistance level of $100.

Technically, Bond prices are now trading below the 25-day Moving Average and just above important support at the 50-day Moving Average, presently at $100.39. The Bond hasn't closed below the 50-day MA since late July, so a close beneath this level would be negative for Bonds. For now we want to be patient and see if the Bond can remain above the 50-day Moving Average. So for now, we will Cautiously Float, but be ready to lock if the Bond breaks below this floor of support.

As of today, we are still offering 6.5% for a 30-year fixed, no points.

Make it an AWESOME day!

Santos

Mortgage Market Update as of Tuesday, November 6th

Santos Sanchez (FAMILY HOME LOANS) — Tue, 06 Nov 2007 11:18:09 -0600

RATE INCREASE! We expected rates to increase from yesterday's rate sheets following the stock market's rebound late in the day. Again, stocks and bonds compete against each other so, typically, when one is having a good day, the other suffers.

WHAT'S GOING ON.....

This morning, there are no economic reports scheduled for release. Bonds are lingering near support and the good news is that Bonds do have additional multiple levels of support closely underfoot - starting with the very important 25-day Moving Average.

On the heels of yesterday's recommendation to Lock, we could see a little more price erosion (rate increase)before a likely bounce higher off support. So for this morning, I will cautiously float and watch how the Bond trades. If Bonds break below the 25-day Moving Average, I will change my stance to locking.

As of today, we are offering a 30-year fixed rate at 6.50% with no points.

Make it a GREAT day!

Santos

Mortgage Market Update as of Monday, November 5th

Santos Sanchez (FAMILY HOME LOANS) — Mon, 05 Nov 2007 14:55:23 -0600

GOOD MONDAY AFTERNOON, everyone!

As we're heading for the close of the day, mortgage bonds are taking a hit. Currently down -22 basis points so we may see lenders send a late-day, intraday rate increase. If not tonight, it may spill into tomorrow's rate sheets.

WHAT'S GOING ON....

More bad news was reported over the weekend from Citigroup. Citigroup, the nation's largest bank, warned it will take an additional $8 to $11 billion write-down from debt investments linked to mortgage-backed securities that have gone bad, after already announcing a $6.5 billion loss from debt write-downs when they announced third quarter earnings not long ago. The company's chairman and chief executive, Charles Prince, resigned during an emergency meeting of it's board of directors on Sunday. Former Treasury Secretary Robert Rubin will be taking over as Chairman.

We thought that the continued uncertainty behind the severity of the sub-prime issue was going to weigh on Stocks today and they did move further to the downside; however, in the last hour or so, stocks have rebounded and now bonds are taking the hits against the chin.

With no more economic reports coming out until Thursday, we may see further deterioration in mortgage bonds so we are going to suggest to lock. As of 3:54 pm, we are still offering 6.375% for a 30-year fixed with No Points.

Have a fantastic day!

Mortgage Market Update as of Friday, November 2nd

Santos Sanchez (FAMILY HOME LOANS) — Fri, 02 Nov 2007 09:28:30 -0500

TGIF!!!!

Another crisp Fall day here in Michigan! I hope everyone had a fantastic Halloween and I hope everyone has scheduled an emergency dental appointment! :)

On the business front......

The best Jobs number in six months hit the wires this morning. Non-farm payrolls were reported at 166,000 for the month of October. This is more than double market expectations and previous revisions were negligible. The unemployment rate held steady at 4.7%. Stocks opened higher on the strong economic news and Bonds are started the day with some weakness, but looks like they've rebdounded. Currently, mortgage bonds are up +9 basis points.

With such a strong Jobs number, we would normally expect Bond prices to be in worse shape than they are currently showing. But they are only moderately lower because the inflation component of the Jobs Report, Hourly Earnings, came in up 0.2% when the market was expecting 0.3%. Additionally, the strong Jobs number reduces chances for another Fed cut and that is good news for inflation hating Bonds. It will be interesting to see how the trading day plays out and if Stocks or Bonds gain the upper hand.

Technically, we are right in between resistance and support, where prices have traded for the past two weeks. At this point we have already preserved pricing near the best levels of the past week by locking, so there is no rush to lock this morning. We will cautiously float and watch for any developments in trading throughout the day.

As of today, we are offering a 30-year fixed rate at 6.375%.

Make it a FANTASTIC day....and have a GREAT weekend!

Santos

10/31/2007 -- Fed Lowers The Fed Funds Rate by .25 basis points

Santos Sanchez (FAMILY HOME LOANS) — Wed, 31 Oct 2007 15:57:25 -0500

We were right on! The Fed lowered the rate to 4.50%.

So how did mortgage bonds / interest rates react? Believe it or not, we might see a rate increase tomorrow. Anytime the Fed lowers this rate, there is always a concern over inflation. So we'll see what happens!

Have a GREAT Halloween!

Mortgage Market Update - Wednesday, October 31st - Happy Halloween!

Santos Sanchez (FAMILY HOME LOANS) — Wed, 31 Oct 2007 09:16:57 -0500

So how many of you spent time this week raking ALL of your leaves! In my neighborhood, we have a ton of trees and it's a beautiful place to live. But in the fall? Let's just say it's not my FAVORITE time of the year! But at least a 3 foot child won't disappear in my front yard because of all of the leaves!

Now to business...........

Today is Fed day. At 2:15pm ET, the Fed will release it's monetary policy decision and statement.

Meantime, Bond prices are trading a little lower, currently -9 basis points, on some hotter than expected economic news. Third quarter GDP was reported at a beefy 3.9% annual growth rate in the face of one of the worst housing slumps in decades - this is good news for the economy, but bad news for Bonds. The increase caught economists by surprise as their consensus estimate called for a 3.1% growth rate. It appears to us that the softer Dollar has added quite a boost to the economy because our goods and services are more attractive to foreigners. Additionally, US residents may shy away from purchasing foreign goods because they require more Dollars to obtain them.

Also applying a little selling pressure to Bonds is a stronger than expected ADP report, which showed 106,000 private sector jobs created in October. After adding a three month average of 23,000 new government jobs, the ADP Report predicts a total of 129,000 new jobs for October, a significantly greater number than the current consensus estimate of 80,000 new jobs. ADP has been more accurate of late as a tool to forecast the official Jobs number. Tomorrow, we will be laying out our Jobs Report strategy heading into Friday's report.

Chicago Purchasing Managers Index (PMI) was reported at 49.7, which was less than expectations of 53.0. Readings above 50 indicate economic growth while those below 50 indicate contraction. Bonds had little reaction to this weaker than expected report.

This morning's strong GDP did catch the market by surprise and many are saying the Fed will not cut rates this afternoon. We disagree and believe the Fed will cut rates by .25% today. It will be important to hear what the Fed has to say in their statement. For now, we will cautiously float as the Bond trades just above an important floor of support heading into today's important announcement.

As of today, we are still offering 6.25% on a 30-year fixed with NO points.

Have a Safe and Happy Halloween!

Santos

NO Money Down Programs? Do They Still Exist? ABSOLUTELY!

Santos Sanchez (FAMILY HOME LOANS) — Tue, 30 Oct 2007 09:04:08 -0500

Good Tuesday Morning!

Yes, ZERO DOWN programs still exist! Granted, the credit score requirement keeps itching up and guidelines are continously changing......but they do exist!

Ask me how I can help you move into a home with very little or NO money down.

Mortgage Rates as of today are 6.25% for a 30-year fixed with NO points. Rates have not dropped to these levels in quite a few months so it's a welcomed change.

Make it a GREAT day!

TGIF!! Mortgage Bonds / Interest Rates Closing the Week on a POSITIVE Note

Santos Sanchez (FAMILY HOME LOANS) — Fri, 15 Jun 2007 10:28:55 -0500

T.G.I.F! To All!

Mortgage Bonds are rallying sharply higher this morning. The reversal from the floor we had identified is continuing in full form, and adding even more favorable technical signals by way of a positive stochastic crossover.

Giving Mortgage Bonds some additional help, is the tame read on Core Consumer Inflation. The Core Consumer Price Index (CPI) for May was reported today at 0.1%, which was lower than expectations of 0.2%. Additionally, the year-over-year Core CPI dropped to 2.2%, which is the lowest read in more than a year, and is moving closer to the Fed's target zone for Core Inflation of 1 - 2%. Since inflation erodes the buying power or value of the fixed return that a Bond provides, the news of inflation moving lower is very good news for the Bond market.

And the tame inflation reading is even helping Stocks. In recent days, Stocks had been selling off on the fear that interest rates were going to rise - which could hurt Stocks, as higher rates make it more expensive for businesses to "do business". But after seeing this morning's tame Consumer Inflation read, Stock traders started buying with both fists, driving Stock prices higher this morning as well. Maybe stock traders are seeing a peak in interest rates too. Where's Bill Gross?

Aside from the big headline news of the Consumer Price Index, there were a few other reports released, but their importance and impact paled in comparison to the welcome read on lower inflation. Mortgage Bonds are showing signs of life. But for the winning streak to continue for Bonds, it will have to claw through multiple layers of overhead resistance. We will continue to float, be patient and see if prices can further stabilize and climb higher. BUT REMEMBER--it takes a lot longer for rates to decrease where it only takes an minutes for rates to increase.

Have a GREAT weekend!

~Santos

Interest Rate Increases -- Has the BLEEDING Stopped?

Santos Sanchez (FAMILY HOME LOANS) — Wed, 13 Jun 2007 13:46:23 -0500

Prices may have finally found a bottom!

Back on May 15th, we issued a very important lock alert as prices broke below a very important floor of support. We have often discussed the importance of this floor and how prices had only crossed it twice in over two years. This crossing represented a major change in market sentiment in the past, and last month's break below it was no exception. Since breaking under this floor, prices have now declined by 274bp as of the lows hit this morning!

We are FINALLY turning optimistic on bonds!!! Is it because Bill Gross just went bearish? No. It is because the long term floor of support has finally been hit and appears to look as if it may hold and support prices. Mortgage Bonds are showing the early makings of a reversal after opening lower and trading beneath the important long-term support level we had identified to you at $97.84. The Bulls quickly recovered and pushed prices higher and back above this critical floor. Why is $97.84 such a significant floor of support? The Bond's rally last Summer started when prices hit this level back on June 26, 2006. Prior to that, $97.84 also represented a support level dating back to May 2002! This proven strength of support is why we had faith in it's ability to hold prices and stop the bleeding.

Traders appear to be betting on this floor supporting prices, as even a much hotter than expected Retail Sales this morning couldn't pressure prices lower. May Retail Sales soared 1.4% higher, far above consensus estimates of 0.6%, while recording the largest gain over the past 16 months. And seeing the Bond reverse convincingly higher in the face of strong economic news is yet another good sign.

Let's closely watch how the trading day unfolds, but we feel prices will improve. And if the Bond can hold its gains, the start of an improving price trend should be ahead.

Our advice is to FLOAT your interest rate. If anything changes in the reverse, I'll let you know.

Make it a GREAT day!

~Santos

TGIF -- Otherwise, Mortgage Bond Prices Would Probably Keep Falling!

Santos Sanchez (FAMILY HOME LOANS) — Fri, 01 Jun 2007 10:36:18 -0500

OUCH!!!

Bonds woke up in a bad mood today and are currently down -28 basis points.

The Core Personal Consumption Expenditure (PCE) Index for April, which measures core consumer inflation, was reported below expectations at 0.1%. But more importantly, the small 0.1% rise in April helped lower the year-over-year core rate of consumer inflation to 2.0%, which is within the Fed's target zone of 1 to 2%. Unfortunately, this tame inflation data was unable to help Bond prices, which are trading lower and remain stuck in a miserable downtrend. And a look at the bond page shows exactly that...it is amazing to see how bonds have tracked this range on the down escalator.

In other big news today, 157,000 new jobs were created in May, which was moderately higher than expectations of 135,000 jobs, but there was a small revision to the prior two months reports removing 10,000 jobs from what was previously reported. The unemployment rate held steady at 4.5%. This report shows the labor market remains tight, which makes the Fed's concerns of wage based inflation a real issue going forward.

Bottom line - These huge reports came in as we expected and the market is also responding as we expected. Acting on yesterday's strategy and I locked my pipeline and hopefully you advised your customers as well.

Folks, if you have have Pre-Approvals out there I cannot stress enough to make sure they contact their Loan Office just to make sure they can still purchase. Since May 8th, mortgage rates have increased almost a full point so this may kill their deal. Do yourself, your buyer, or your seller a favor and save some misery.

Make it a GREAT day and be safe this weekend!

~Santos

Mortgage Bonds and Cedar Point's TOP THRILL DRAGSTER -- How are they similar?

Santos Sanchez (FAMILY HOME LOANS) — Thu, 31 May 2007 11:29:26 -0500

Cedar Point's Top Thrill Dragster has a 420 feet (42 stories), 120 mph drop. It is a TOTAL blast for anyone who is a roller coaster fanatic like myself. But at least the Top Thrill Dragster stops. Mortgage bonds continue their downward trend in pricing / interest rate increases.

Bonds are currently down -16 basis points so we expect rates to increase. Yesterday, as we expected, the Fed Minutes from May 9 stated "nearly all participants viewed core inflation as remaining uncomfortably high," and "all participants agreed the risks around the anticipated moderation in inflation were to the upside." Even though the Fed went on to say that the economy is growing at a slower pace than anticipated, which would normally be a Bond friendly remark, the concerns on inflation took the air out of yesterday morning's early gains and left Bonds finishing the day unchanged.

This morning the Preliminary Gross Domestic Product (GDP) for the first quarter of 2007 was revised lower to 0.6%, which was lower than expectations of 0.8%. A larger trade deficit, falling inventory levels, and declining investments in the Housing Sector all contributed to the decline. This was the slowest growth rate since the fourth quarter of 2002. The 0.6% level is close to zero - and remember that 2 consecutive quarters of negative GDP growth is a Recession. We think the economy will do better in the second quarter.

Even the anemic growth rate could not help Bonds move higher - Why? The "I" word - INFLATION. Within the GDP report is the accompanying Chain Deflator, which measures inflation of a basket of goods and services and it showed inflation rising at a 4.4% annualized rate, the most since 1991. Even though most of the increase came from soaring food and energy costs, the Fed's concern over inflation remains valid.

The Chicago Purchasing Managers Index was reported at 61.7 which was much hotter than expectations of 54.0 and matches the highest reading in two years. Mortgage Bonds quickly dropped on this strong report.

Stocks remain on fire and have now set a new closing high for the S&P 500. And yesterday we thought they would rally even though they were lower when the update was published. They appear destined to reach an overextended level before the inevitable and significant decline. Until this happens, stocks will remain a drag on bonds.

Jobs Report and Core PCE Strategy

Tomorrow we have two super high-impact reports scheduled for release - the Jobs Report and the Core Personal Consumption Expenditure (PCE) Index. So how do we advise our clients going into tomorrow? Expectations are for around 135,000 jobs and the recent ADP data and Initial Jobless Claims reports suggest the number should come in close to expectations. We think the report will come in a bit higher but also close to expectations. Look for a level around 137,000. The Unemployment Rate should hold steady at 4.5%. Bonds will probably have some trouble with tomorrows numbers.

The Core PCE may be a sign of good news; we expect the number to be 2.0% to 2.1% Year over Year. This would be a good number, but will it be good enough to get bonds out of the nasty downtrend...probably not.

One thing I have learned is that you can't fight the trend, even if the trend is not correct. For now, it's higher stocks and lower bonds. Lock until it's over.

Make it a GREAT day!

Niche Mortgage Products -- Sellers, Listing Agents, and Buyers....Listen Up!

Santos Sanchez (FAMILY HOME LOANS) — Wed, 30 May 2007 11:50:16 -0500

I FINALLY got my new yard signs for a few niche programs that we are offering:

MORTGAGE MAKEOVER (we liked PIMP MY HOUSE but management wasn't going for it!)--Many homes out there need a new kitchen or a new roof......or both. The seller may not want to do the improvements and sell the house "as is." Many buyers have very little or no money to put into a purchase transaction so buying a house that needs a lot of work may not work for them. Look no further--our Mortgage Makeover will allow the buyer to finance all of the improvements into the loan. The buyer get a licensed builder and they submit the type and amount of imrpovements to us. We give this "bid" do the appraiser and they appraise the house as if these items were completed.

BUY THIS HOME WITH 6 MONTHS FREE: Most transactions that I see come across the desk have some type of seller concessions whether it's 3%, 6%, etc. On this program, the seller is agreeing to pay UP TO 6 months of the buyer's Principal and Interest payments (escrows are paid by the buyer). It's a perfect program for someone who has a house to sell and are leary of having two mortgage payments. As I stated before, many buyers have little or no money to work with so by not making any payments for 6 months, they have the money to buy furniture, carpet, etc.

BELOW MARKET INTEREST RATES: This program also requires 3% seller concession from the seller. Let's say today's interest rate is 6.00% and we locked at this rate. For the first year, the buyer's rate is 4%. The second year, the rate increases to 5%. For the remaining twenty-eight years (assuming a 30-year fixed), the rate is fixed at 6%. This is a great tool for a first-time homebuyer who is afraid to purchase a home because of "payment shock." It also alleviates the buyer who still has a home to sell.

If you are a local agent or seller interested in these signs, please do not hesitate to ask. If you are a buyer interested in any of these programs, give me a call. I would be happy to assist you in your home-purchasing needs.

Make it a great day!

~Santos