All Encompassing Mortgage and Real Estate Thread

[Wulaw Horn 19,076]

On 4/25/2022 at 12:52 PM, Wulaw Horn said:

Same caveat as always- this is not a guarantee to lend.  This is not the rates we are putting actual human beings in at right now (we are typically better but I also just locked someone at 6 who was happy to have it- so situations are different blah blah blah.  But this is the actual average of interest rates for all deals locked on Friday afternoon.  Yikes.  

 

30-YR. CONFORMING

5.405% +0.038

30-YR. JUMBO

4.951% +0.090

30-YR. FHA

5.259% +0.047

30-YR. VA

5.096% +0.064

30-YR. USDA

5.215% +0.087

15-YR. CONFORMING

4.540% +0.083

Started with 2 great days last week, then by Monday morning we are up from where we were last Monday morning.  Fun stuff.  Caveat- this is not an offer to lend, this does not mean that we wouldn't have a lower rate for you than this (or a higher one), blah blah blah... Also, MBS market is down 34 points already this morning (MBS down is bad for rates). 10 year treasury is up 10 basis points to almost 3!- 10 year treasury being up typically is a signal that we've got bad news for rates (inverse relationship there)

30-YR. CONFORMING

5.415% +0.058

30-YR. JUMBO

4.890% +0.030

30-YR. FHA

5.275% +0.036

30-YR. VA

5.076% +0.057

30-YR. USDA

5.203% +0.033

15-YR. CONFORMING

4.524% +0.072

[closetohumping 17,442]

Shit is still going for over asking price.

[Gil Bang 25,961]

3 hours ago, closetohumping said:

Shit is still going for over asking price.

Yeah, but, at some point it becomes a marketing strategy. 

Price it lower than i will sell for to get more buyers interested.   It's a sound strategy in a hot market.   If I were listing your home, I'd price it consistent with comps for the last 6 months, and limit the showing times so the interested buyers see other "interested" buyers. 

[Neonmoon 38,129]

15 minutes ago, Gil Bang said:

Price it lower than i will sell for to get more buyers interested.

This is SOP where I live. 

You see a house hit the market, and you're like, that's way 20K too low. Boom, 35 offers for 50K over. 

[hornian 5,219]

17 hours ago, CooterBrown said:

I talked to one of our HR recruiters and since we went back to the office twice a week on April 1, we’ve had 800% more retirement submittals this month than our normal monthly average. Basically, no one who’s eligible to retire is staying on if they have to go back to the office.

Our IT department also had to ask for a waiver in the back-to-the-office policy because no one will even accept an interview unless it’s full time WFH.

Good. I honestly think one of the issues, structurally, with our workforce, and by correlation, housing market is people who should be retiring and downsizing not doing either. Hope this makes people who should retire, retire, and that in turn makes the retires sell their huge suburban home to go live in an "active senior" community. 

[Chewbacca 7,780]

10 minutes ago, hornian said:

Good. I honestly think one of the issues, structurally, with our workforce, and by correlation, housing market is people who should be retiring and downsizing not doing either. Hope this makes people who should retire, retire, and that in turn makes the retires sell their huge suburban home to go live in an "active senior" community. 

When the average American doesn't have a pot to piss in, it makes retirement tough.

[Pato del Muerto 52,507]

42 minutes ago, Neonmoon said:

This is SOP where I live. 

You see a house hit the market, and you're like, that's way 20K too low. Boom, 35 offers for 50K over. 

There’s also analytics about certain thresholds that are being tracked by websites on filters, like what the usual max price filter selection is for your neighborhood/area. If you are near that, you price it just under so you generate more search hits-> more viewings->more competition->higher bids

[hornian 5,219]

2 hours ago, Chewbacca said:

When the average American doesn't have a pot to piss in, it makes retirement tough.

Counterpoint:

When the average baby boomer has most of their net worth tied up in real estate; they should sell to access the equity and live off of in their twilight years. 

[Blotto 23,525]

3 hours ago, Chewbacca said:

When the average American doesn't have a pot to piss in, it makes retirement tough.

And when the average American doesnt have a pot to piss in, yet somehow 35% of home purchases are all cash offers, it makes you wonder what the fuck is going on. I guess corporations/ibuyers are just buying up inventory indiscriminately, but its not exactly helping matters. They make fat profits though so its all good. 

[Chewbacca 7,780]

2 minutes ago, Blotto said:

And when the average American doesnt have a pot to piss in, yet somehow 35% of home purchases are all cash offers, it makes you wonder what the fuck is going on. I guess corporations/ibuyers are just buying up inventory indiscriminately, but its not exactly helping matters. They make fat profits though so its all good. 

Yep, Blackstone (or Blackrock, I often confuse the two) opened those gates after the 2008 crash and they did so well on it, there's a ton of money chasing single family homes now.

[jimmyjazz 45,963]

1 hour ago, hornian said:

Counterpoint:

When the average baby boomer has most of their net worth tied up in real estate; they should sell to access the equity and live off of in their twilight years. 

My concern is what happens if inflation gets worse, or even stays at current levels for years?  Cashing out could lead to some pretty serious declines in net worth over the years without aggressive investments.  The flip side of that argument is what happens if inflation continues but home prices collapse?

My crystal ball needs a tuneup.

[Upgrayedd 5,813]

3 hours ago, hornian said:

Counterpoint:

When the average baby boomer has most of their net worth tied up in real estate; they should sell to access the equity and live off of in their twilight years. 

Maybe reverse mortgages are tempering that activity a bit.  I have no idea really.

[closetohumping 17,442]

I'm kind of torn. A big part of me wants to just rent out this California house and hopefully have someone else pay my mortgage, but I'd like to be a bit more liquid and of course.  

[Chewbacca 7,780]

I'm kind of torn. A big part of me wants to just rent out this California house and hopefully have someone else pay my mortgage, but I'd like to be a bit more liquid and of course.  

As long s you have enough liquidity why do you need more?

[Sam Lin 3,559]

How many Lambos is "enough liquidity?"

[Gil Bang 25,961]

On 5/2/2022 at 6:11 PM, closetohumping said:

I'm kind of torn. A big part of me wants to just rent out this California house and hopefully have someone else pay my mortgage, but I'd like to be a bit more liquid and of course.  

You are in a CRAZY valuable town.  Have you considered selling, taking the $500,000 exemption, and buying a cheaper place...while hanging on to your tax base? 

[Gil Bang 25,961]

On 5/2/2022 at 8:06 PM, Chewbacca said:

On 5/2/2022 at 6:11 PM, closetohumping said:

I'm kind of torn. A big part of me wants to just rent out this California house and hopefully have someone else pay my mortgage, but I'd like to be a bit more liquid and of course.  

As long s you have enough liquidity why do you need more?

also, when you list, please let me know so I can stop responding to  you directly.  It's a violation of the CAR code of ethics. 

[BillyMadison 7]

Major lurker, non-existent poster here. Thought I would ping the Surly collective here-we’re bidding on houses in Dallas, $950-$1MM range. We’re going to put down 20% cash then probably put more down when we sell our house. Credit scores for wife and I are 780/800. Couple of questions:

1. When I put more cash down, our mortgage broker is saying we can reset our amortization schedule for a lower payment-is that true/is it that simple? Really want to keep our mortgage payment as reasonable as possible

2. He’s telling me a 5% rate/no points is what I should use this week. Does that sound reasonable? I’ll want to price check him before we lock

3. Any idea how to keep tax man from shoving his boot 100% from going up my ass next year? Our current house was bought off-market so they never really knew purchase price/shoved boot all the way up our ass

Gracias for any intel you guys can provide


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[StruggleBus 3,922]

48 minutes ago, BillyMadison said:

we’re bidding on houses in Dallas, $950-$1MM range

 

48 minutes ago, BillyMadison said:

We’re going to put down 20% cash

 

49 minutes ago, BillyMadison said:

He’s telling me a 5% rate/no points

 

49 minutes ago, BillyMadison said:

Really want to keep our mortgage payment as reasonable as possible

[Neonmoon 38,129]

1 hour ago, BillyMadison said:

Major lurker, non-existent poster here. Thought I would ping the Surly collective here-we’re bidding on houses in Dallas, $950-$1MM range. We’re going to put down 20% cash then probably put more down when we sell our house. Credit scores for wife and I are 780/800. Couple of questions:

1. When I put more cash down, our mortgage broker is saying we can reset our amortization schedule for a lower payment-is that true/is it that simple? Really want to keep our mortgage payment as reasonable as possible

2. He’s telling me a 5% rate/no points is what I should use this week. Does that sound reasonable? I’ll want to price check him before we lock

3. Any idea how to keep tax man from shoving his boot 100% from going up my ass next year? Our current house was bought off-market so they never really knew purchase price/shoved boot all the way up our ass

Gracias for any intel you guys can provide


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1. Yes, you can recast your loan after you sell your house and put down an additional lump sum. Depends on the jumbo program whether it is allowed and the parameters. 

2. Yes, that is a good rate. 

3. You will take the tax man's boot in your ass and you will like it

[BillyMadison 7]

1. Yes, you can recast your loan after you sell your house and put down an additional lump sum. Depends on the jumbo program whether it is allowed and the parameters. 
2. Yes, that is a good rate. 
3. You will take the tax man's boot in your ass and you will like it

Thank you!


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[BillyMadison 7]

No good luck here….likely only bad luck


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[Wulaw Horn 19,076]

1 hour ago, BillyMadison said:

Major lurker, non-existent poster here. Thought I would ping the Surly collective here-we’re bidding on houses in Dallas, $950-$1MM range. We’re going to put down 20% cash then probably put more down when we sell our house. Credit scores for wife and I are 780/800. Couple of questions:

1. When I put more cash down, our mortgage broker is saying we can reset our amortization schedule for a lower payment-is that true/is it that simple? Really want to keep our mortgage payment as reasonable as possible

2. He’s telling me a 5% rate/no points is what I should use this week. Does that sound reasonable? I’ll want to price check him before we lock

3. Any idea how to keep tax man from shoving his boot 100% from going up my ass next year? Our current house was bought off-market so they never really knew purchase price/shoved boot all the way up our ass

Gracias for any intel you guys can provide


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Neon answered very well. 
the 5% is slightly higher than the national average for jumbo loans as of all loans locked in my pricing engine nationally last Friday. Markets have gotten slightly worse since the.  You are probably dead balls on average at that rate for a loan in your situation.  
I did send you a PM about an option we have for a situation for people very much doing what you are describing with a pretty significantly lower rate. 

[Wulaw Horn 19,076]

Fed minutes out today at 1:00. I would strongly advise getting a lock in before they get published as the last 3 or 4 times this has happened MBS have shot down (bad for rates when MBS get worse) close to 100 basis points when they start talking. That’s something like 100 points. 
could the discussion make things better for the market?  Sure, but it’s been a looooong time since that happened and in a completely different climate. 

[UTPhil2006 3,807]

56 minutes ago, Neonmoon said:

1. Yes, you can recast your loan after you sell your house and put down an additional lump sum. Depends on the jumbo program whether it is allowed and the parameters. 

2. Yes, that is a good rate. 

3. You will take the tax man's boot in your ass and you will like it

Pretty much this.  Most recast for a reasonable fee but your broker should be able to tell you that up front.  For instance UWM is only $150

Good rate for conventional, ish rate for jumbo.  

Just ask them to shine the boot first

[royiv 9,323]

2 hours ago, BillyMadison said:

3. Any idea how to keep tax man from shoving his boot 100% from going up my ass next year? Our current house was bought off-market so they never really knew purchase price/shoved boot all the way up our ass

Just a quick point of clarification for you. You will still get the boot, but it doesn't have anything to do with whether or not it's an off market purchase or on the MLS. Purchase prices are not reported to the appraisal district in TX. They will likely send you a letter after you close on the house and ask you to self disclose the purchase price, but you are under no obligation to do so. Promptly throw that letter in the trash.

[Skipper 6,135]

4 minutes ago, royiv said:

Just a quick point of clarification for you. You will still get the boot, but it doesn't have anything to do with whether or not it's an off market purchase or on the MLS. Purchase prices are not reported to the appraisal district in TX. They will likely send you a letter after you close on the house and ask you to self disclose the purchase price, but you are under no obligation to do so. Promptly throw that letter in the trash.

I'm also pretty sure you can specifically request that the purchase price not be revealed in the MLS in Dallas when negotiating your purchase contract.  I was under the impression that the appraiser had some sales data based on negotiations when I protested. 

[Esque 135]

Let's assume Fed announces 50 bps today and $50 - $75 Bn b/s run off on a go forward basis.  Most, or at least a lot, of b/s run off is going to be MBS.  So rates jump from let's say 5.35% to what?  6.50%?  How bad does Fed selling (which also means stop buying) in the MBS market whack spreads?

How and when does this translate to pricing in residential?  Seems crazy that we're still seeing price increases.  Something has to give?

[closetohumping 17,442]

25 minutes ago, Esque said:

Let's assume Fed announces 50 bps today and $50 - $75 Bn b/s run off on a go forward basis.  Most, or at least a lot, of b/s run off is going to be MBS.  So rates jump from let's say 5.35% to what?  6.50%?  How bad does Fed selling (which also means stop buying) in the MBS market whack spreads?

How and when does this translate to pricing in residential?  Seems crazy that we're still seeing price increases.  Something has to give?

AS a consumer that's my hope.  Interest rates go up, price goes down......right after I sell my house.

[Incredulity 11,675]

50 minutes ago, closetohumping said:

AS a consumer that's my hope.  Interest rates go up, price goes down......right after I sell my house.

It seemed like the 08-09 housing calamity didn't really get reflected in pricing until 12-13.  We have run higher faster this time though so who knows.

[Wulaw Horn 19,076]

Fed didn't spook the market yet.  Stuff went from down 10 to down 22- so not much yet.  Not sure if he's spoken yet or just released the notes so we aren't out of the woods yet.  
Said 0.5 basis point hike (which will be a moderating influence to help mortgage rates get better on traditional fixed 15 and 30 year products- not so much your heloc's and the like), but we need more

$47.5 million balance sheet run off starting in June, running through August.  That obviously doesn't get rid of all their balance sheet by then, so who knows what they do after that.  

I think this is like fighting a house fire (inflation) with a fire extinguisher, but at least we started the actual action step as opposed to the speaking about action step.  More than they can say for Europe.  

[Neonmoon 38,129]

Quote

The Federal Reserve raised interest rates by a half percentage point and announced a plan to shrink its massive bond holdings, decisive measures aimed at tamping down the fastest inflation in four decades.

Wednesday’s move marked the Fed’s largest interest rate increase since 2000, and by shrinking its $9 trillion balance sheet at the same time, the Fed is rapidly withdrawing support from the economy. Together, the policies are likely to ricochet through markets and the economy as money becomes more expensive to borrow.

The Fed plans to shrink its balance sheet starting in June by allowing securities to mature without reinvestment. It said on Wednesday that it will ultimately let up to $60 billion in Treasury debt expire each month, along with $35 billion in mortgage-backed debt. That plan will have phased in fully as of September.

https://www.nytimes.com/live/2022/05/04/business/fed-meeting-rates-inflation?smid=url-copy#fed-rate-decision-inflation

 

[Wulaw Horn 19,076]

And Market is down another 20 or 25 bips in the last 10 minutes.  Hang on for the re-price for worse- shockingly.  Gonna be a whipsaw to end the day probably.  

 

And now we are up 2 points for the day- literally in 5 minutes.  This shit is comical.  Main takeaway from the day is on a day that had the chance to change the direction of where we are going doesn't look like that happened.

HA- now up 36 since I typed/thought about that last sentence.  Go home MBS Market- you are drunk. 

Edited May 4, 2022 by Wulaw Horn

[UTPhil2006 3,807]

Likely will end up as a good day in the market 

[UTPhil2006 3,807]

3 hours ago, UTPhil2006 said:

Likely will end up as a good day in the market 

Now the question is will it hold the next 2 days. 

[UTPhil2006 3,807]

15 hours ago, UTPhil2006 said:

Now the question is will it hold the next 2 days. 

Noooope 

[Wulaw Horn 19,076]

Up 59 yesterday. 
down 56 Today as of this minute. 
can’t ever sustain a rally. Bad days have zero problem consolidating losses. 

[UTPhil2006 3,807]

I thought the song was Sunday Bloody Sunday not Bloody Thursday 

[Wulaw Horn 19,076]

5 minutes ago, UTPhil2006 said:

I thought the song was Sunday Bloody Sunday not Bloody Thursday 

You scared me. I actually turned off my MBS highway at -70 points about 45 minutes ago b/c it was so disgusting.  Then I saw this and wondered- did we lose another 50 or something.  Made me turn it back on and see nope- still just down a cool 75 points for the day.

[UTPhil2006 3,807]

7 minutes ago, Wulaw Horn said:

You scared me. I actually turned off my MBS highway at -70 points about 45 minutes ago b/c it was so disgusting.  Then I saw this and wondered- did we lose another 50 or something.  Made me turn it back on and see nope- still just down a cool 75 points for the day.

Pretty sure besides after the election in 2016 worst day on record if it stays 

[Wulaw Horn 19,076]

Just now, UTPhil2006 said:

Pretty sure besides after the election in 2016 worst day on record if it stays 

It's brutal out there man. 
I snapped at my wife about something that wasn't really her fault (kids messed with the computer and I couldn't figure out what they did) and she got pissy. I was like, after cooling down a bit, I'm sorry babe, it's just this damn war and that lying son of a bitch Johnson. 

[UTPhil2006 3,807]

13 minutes ago, Wulaw Horn said:

It's brutal out there man. 
I snapped at my wife about something that wasn't really her fault (kids messed with the computer and I couldn't figure out what they did) and she got pissy. I was like, after cooling down a bit, I'm sorry babe, it's just this damn war and that lying son of a bitch Johnson. 

If I wasn’t in so much pain from Chaz McCormick trying to break my hand on a foul ball I’d be right there with you 

[Neonmoon 38,129]

30 minutes ago, Wulaw Horn said:

I'm sorry babe, it's just this damn war and that lying son of a bitch Johnson. 

Definitely my go to line when I realize I'm wrong

[Neonmoon 38,129]

Look at these fucking assholes. Redfin has this as their 30 yr fixed rate right now on their website. 

 

[closetohumping 17,442]

so higher rates should lead to lower prices?  Maybe?

[Pato del Muerto 52,507]

1 hour ago, Neonmoon said:

Look at these fucking assholes. Redfin has this as their 30 yr fixed rate right now on their website. 

 

My mother got quoted 5.375 and no origination yesterday from a credit union.  Guy also said 120 day lock was available. I initially advised her to hold off since she doesn’t have a property, but maybe I should reverse course?

[T’Boo Ted Marshall 2,732]

House went up last night.
2 all cash offers so far with one being $25k over ask.

[Hefeweizen 5,324]

6 minutes ago, closetohumping said:

so higher rates should lead to lower prices?  Maybe?

Let’s hope brother.  I’m scheduled to close in a couple of weeks, then I’m ready to go shopping.  Right now it looks like a raging wasteland for buyers though.

[closetohumping 17,442]

8 minutes ago, Hefeweizen said:

Let’s hope brother.  I’m scheduled to close in a couple of weeks, then I’m ready to go shopping.  Right now it looks like a raging wasteland for buyers though.

Where you headed?   Good luck man.  We’re looking in august but if rates go up I’ll likely wait it out

[BillyMadison 7]

I can say in the pockets of Dallas we’re looking, the number of offers has slowed in the past few weeks from 10+ to 2 or 3. Also, we were losing to people bidding 20% or so over ask, and now we’re only losing to people bidding 5-10% over ask. Now, asking prices may be up too, but feels less frothy than a month ago.


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