Weekly Market Forecast

MSHDA reduces the interest rate today to 5.875%!!!!!!

Week of: Monday, August 13, 2007

Present Market Conditions
The financial markets have been in the media headlines with high levels of volatility over the past week. Although 98.6% of all U.S. mortgages are performing and not late or in default, foreclosure rates are up 30% since 2006 among loans to borrowers with marginal credit. As a result, major investors have begun to shy away from mortgage backed securities. In essence, the entire mortgage debt market is being adversely affected by high levels of “irrational fear”. Several retail lenders have gone out of business because they have been denied access to their corporate warehouse credit lines. Consumers can have ample access to purchase homes and refinance existing loans but current market conditions will lower loan to value ratios and raise interest rates on jumbo mortgage loans.

Expectations
Ken Goldstein, an economist for the Conference Board, has said he doesn’t believe the sub-prime situation is enough to send the economy off-track. According to Goldstein, though, as long as employment stays strong and workers’ earnings grow substantially (4 percent annually, according to him), confidence – and spending – will remain high and the economy will chug along. “Not only is the economy strong enough to survive the crisis, it’s strong enough to quiet it,” he said.

Guidance
Mortgage interest rates remain historically low. With tightened lending standards and the heightened awareness of the importance of professional financial advice, its in your best interest to work with a knowledgeable mortgage lender when purchasing or refinancing your home.

Authored by Georgie Cook
Traverse Mortgage Corporation
(231) 947-9700
(800) 968-3680
georgie@traversemortgage.com

Debt to Income Ratios?

Presenting words of truth written by a Traverse City area mortgage guru, Guy Cole of Countrywide Home Loans.

You’re meeting with your lender. All of a sudden terminology is being thrown at you left and right. Closing costs, pre-paids, down payment, assets, liabilities, income to debt ratios. You were ok up to the last one. Ratios? Now we are back in math? Lenders determine how much you’re loan amount can be based on how much you make and how much you owe, commonly called debt to income ratio’s. Example: Gross monthly income is $5,000.00 per month; therefore your housing cost should not exceed 31% or $1,550.00 including property taxes and home owners insurance. Your total debt should not be more than 42% of your income or $2,100.00. This is where you need to establish your own budget based on total expenses per month to insure you’re comfortable with the total payment that you’re being quoted. Things have a tendency to get a little scary when you’ve paid all of your monthly expenses only to discover you need to go grocery shopping and guess what? All of the money is now gone. Have fun looking for your home, the team at International Realty Plus is a great place to start.

Authored by Guy Cole
Countrywide Home Loans
(231) 941-5767 ext. 226


CMD 1261 – Traverse City, Mi

Weekly Market Forecaset

Week of: Monday, June 25, 2007

Present Market Conditions
Mortgage rates dropped slightly last week amid concerns that the housing market will continue to create drag on the economy into the second half of the year. In addition, on Friday the Dow Jones Industrial Average dropped 185 points, the S&P 500 Index lost 19 points and the Nasdaq Composite Index fell 28 points. Now many investors are holding their breath in anticipation of the many economic reports due to be released this week. Some of the highlights include personal spending and income, home sales, durable goods, and consumer confidence. In addition, the Fed will be meeting Wednesday and Thursday for their policy meeting to set the overnight lending rate.

Expectations
While bond yields have recently increased, investors aren’t expecting the Federal Reserve to change its 5.25 percent short-term rate. According to The Wall Street Journal, “With higher bond yields, the Fed now also has less reason to raise its target rate. That’s because businesses and consumers face higher borrowing costs, which are likely to produce slower growth ahead. In effect, the bond market is doing some of the Fed’s job of keeping total spending in the economy, and thus inflation pressure, within the economy’s normal capacity.”

Guidance
Given one of the strongest global economies in 30 years, attractive U.S. interest rates and the over supply of available homes for sale, the residential market continues to present excellent opportunities for home buyers. Consulting with a true mortgage professional will ensure every real estate transaction is optimized to meet your financial needs.

Authored by Georgie Cook
Traverse Mortgage Corporation
(231) 947-9700
(800) 968-3680
georgie@traversemortgage.com

Weekly Market Forecast

Week of: Monday, May 21, 2007

Present Market Conditions
The Dow Jones Industrials ended the week on an all-time high. With investors focusing on blue-chip mergers and acquisitions, the buying fever led to record highs. More good news was reported last week as the Labor Department announced that jobless claims fell for the fifth straight week. The number of new filings fell by 5,000 in the week ended May 12th. This brought claims to their lowest level since January. The four-week average, which is considered the better model of underlying trends, fell 12,000 and was the lowest level since the week ended April 2006.

Expectations
The Consumer Price Index rose a smaller-than-expected 0.4 percent in April. Stephen Stanley, Chief Economist for RBS Greenwich Capital Markets, was quoted by MarketWatch as saying, “The moderation in housing costs ‘is one of the most significant developments on the inflation front in a long while.’ If the good news persists, ‘then core inflation will probably turn out better than we have projected’ and the Fed will have ‘more room to ease in the event that we are wrong ‘about the economy bouncing back.”

Guidance
Existing home sales in the first quarter were up 2.4 percent over the fourth quarter of last year. In addition, the average pace of mortgage applications for home purchases over the first two weeks in May was the strongest since January 2006. Conditions for home purchases are ideal. Capitalize on this exceptional season by seeking the assistance of Georgie.

Authored by Georgie Cook
Traverse Mortgage Corporation
(231) 947-9700
(800) 968-3680
georgie@traversemortgage.com

INVESTMENT PROPERTIES

Real estate that is purchased solely to generate income or to be sold when the value has appreciated.

Using this definition is its truest form you are purchasing this property to make money, that’s it! There are no secret gimmicks, formulas, or even a get rich quick scheme, if it was as easy as the real estate billionaires on the infomercials lead you to believe we would all be doing it. Remember these people are getting rich on programs they are “selling” to you.

I really like this “Buy and sell real estate and let the lender carry the tab with no money out of your pocket” believe that one and I have chunks of coal I want to sell you because in time they will turn into diamonds. “I guarantee it”

Lenders will take the risk with you but we’re not going it alone, we will take you with us. In other words, yes, you will have to spend some of your money too. How much depends on credit risk, the lesser the risk the less you have to put down and the better the rate. Ten to twenty percent is generally what you can expect, then it becomes how crafty you can get with the purchase agreement as to how much the seller is willing to participate.

International Realty Plus are highly trained professionals in real estate, they know how to present the deal to the sellers. The experts in how to buy and sell real estate are great at selling books, DVD’s, tapes, kits, and getting you to attend lectures, are they really that good? “Those that can, DO. Those that can’t TEACH” I know I heard that somewhere.

Authored by Guy Cole
Countrywide Home Loans
(231) 941-5767 ext. 226