MMG Weekly Newsletter: 2nd week of September issue - Mortgage

Mortgage and Lending with The Christian Penner Mortgage Team NMLS# 368289
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  In This Issue - Mortgage.
  Last Week in Review: The job market is laboring on, but is it moving in the right direction?

Forecast for the Week: Look for several key items at the end of the week, including wholesale inflation, retail sales, and more.

View: Is your email inbox feeling out of control? These simple tips can help.

  Last Week in Review
  "Work, work, work, it's a labor of love."

MortgageThe words to Sammy Kershaw's country song may sound sweeter than the latest employment numbers that were released last week. Read on for details. The Jobs Report for August didn't show much love for workers as the Labor Force Participation Rate, which measures the number of people who are either employed or are actively looking for work, fell to its lowest level in 35 years. Job creations were also lower than expected, with 169,000 jobs created in August versus 177,000 expected. Many of these jobs were in the retail and leisure sectors. Compounding this number, job creations for June and July were revised lower, shaving 74,000 jobs from the previous reports.

The unemployment rate did drop to 7.3 percent--the lowest level since December 2008. However, this number was likely lowered by people leaving the labor force rather than organic job growth. It's also important to note that outplacement firm Challenger, Gray & Christmas said that planned layoffs surged by nearly 40 percent from July to August, reaching the highest level in six months.

In housing news, research firm CoreLogic reported that home prices rose 12.4 percent on a year-over-year basis in the month ended in July. This marks the seventeenth consecutive month of year-over-year price gains. However, home prices remain 17.6 percent below their peak levels, which were set in April 2006.

What does this mean for home loan rates? Weak economic reports can often cause investors to move money out of Stocks and into safer investments like Bonds, including Mortgage Bonds to which home loan rates are tied. We saw some of that dynamic late last week, as Bonds improved after the weak Jobs Report.

The Fed has said that economic data will be a key factor in when it begins tapering the $85 billion in Bond purchases it has been making each month to stimulate the economy and housing market. These purchases have helped home loan rates remain attractive. With economic conditions still wobbly and the housing recovery fragile, the Fed will be watching upcoming economic reports closely.

The bottom line is that now remains a great time to consider a home purchase or refinance as home loan rates remain attractive compared to historical levels. Let me know if I can answer any questions at all for you or your clients.

  Forecast for the Week
  The economic data doesn't begin until late in the week, with several key reports due out on Friday.
  • As usual, weekly Initial Jobless Claims will be released on Thursday. Despite the poor Jobs Report for August, claims have been hovering near 6-year lows.
  • Friday brings the Producer Price Index (which measures inflation at the wholesale level), Retail Sales and Consumer Sentiment.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond that home loan rates are based on.

When you see these Bond prices moving higher, it means home loan rates are improving -- and when they are moving lower, home loan rates are getting worse.

To go one step further -- a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes were on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Bonds were able to improve after the weaker than expected Jobs Report for August. I'll be watching the markets closely as we head toward the upcoming Fed meeting.

Chart: Fannie Mae 4.0% Mortgage Bond (Friday Sep 06, 2013)

Japanese Candlestick Chart

  The Mortgage Market Guide View...
  Are You Buried in Email?
These Simple Tips Can Help
Have you ever felt like some of the technology developed to streamline your workday has actually had the opposite result? Email is often one of the biggest offenders. Here are some great tips to help you manage your inbox.Put key information in your signature. Use the signature field so that you always communicate information in the way you want to share it. Consider creating multiple signatures for various types of emails your send regularly. Examples of items you can include are links to web pages you want people to visit in the near term, answers to current Frequently Asked Questions, and the areas of focus you want your clients to know you are currently researching. Your traditional contact information should also be included.BCC yourself so nothing slips through your follow up list. BCC yourself on communications you know you will need to follow up on. Consider setting up a rule in your email system so that any email FROM you and TO you automatically goes to a "Follow Up" folder. This way, you need only look in one place to find what you're looking for when you're ready to follow up with someone.

Use subject lines to the fullest. A best practice of effective email collaboration: Place a verb at the front of the subject line. Then, use the body of the email to expand on and describe what needs to be done. About the worst thing you can do is to include no subject line at all in the emails you send. In addition, as you send email, especially if it is information that is time sensitive or action oriented, ensure recipients understand this when they see the email in their inbox.

Take time for focused concentration. Some of the emailing you have can be done in between meetings, or while you're waiting on hold for a conference call to start. Other emails will require more focus, longer time periods and fewer distractions. For the latter, consider carving out several no-interruption periods during your day so you can focus solely on emails requiring a longer response.

These tips are tried and true for a reason: they really do work when you use them...and use them consistently! Be sure to pass them along to your clients and colleagues.


Economic Calendar for the Week of September 09 - September 13





Questions, Comments or For more information you can email Christian Penner at or visit us online at or you can call us directly at: 561-316-6800
MMG Weekly Newsletter: 2nd week of September issue - Mortgage

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MMG Weekly Newsletter: 2nd week of September issue - Mortgage


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Matt Kombrink
RE/MAX All Pro - Saint Charles, IL
Your #1 Source For Real Estate

Excellent newsletter, Christian.  Love all the graphs and the economic calendar.

Sep 09, 2013 09:23 AM #1
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