Rates, the Fed, and the Real Story

Yesterday, the Fed announced a 0.25% rate cut. On paper, that means lower rates on equity lines of credit, car loans, and credit cards. Sounds great, right? The reality? It doesn't have a significant impact on mortgage rates. Yesterday was a perfect example.

When the Fed made its announcement, Treasury yields were sitting at 4.02%. Shortly after, they climbed to 4.07%, and today they even hit 4.12% before easing back to the 4.10% range. In other words, the market, not the Fed, decides where long-term rates go.

This morning’s economic reports (Jobless Claims and the Philly Fed) aren’t usually big market movers, but they still played a role. Initial jobless claims came in low again, indicating strength in the labor market. Continued claims were also much lower than expected, with last week’s numbers even revised downward. The Philly Fed report came in strong, too. Together, these data points gave bonds reason to weaken and yields reason to rise.

Here’s the deal:

• It’s not about the Fed.
• It’s about the economic data.

We need to see slowing inflation, job losses, and rising unemployment to really move rates lower. Consider what happened in 2008 or during the COVID pandemic; rates dropped because the economy was in dire straits.

Currently, I believe rates should be lower than they are, and I also think the economy, at least here in California, is weaker than officials are admitting.

So where does that leave us? With more economic reports coming out daily, your rate is only as good (or as bad) as the last piece of data. Tomorrow could change everything.

Good luck out there this weekend!

And don’t forget, Oktoberfest is coming up on October 22nd, from 5:30 - 8:30 pm. We’d love to see you here for a great night!

Please let me know if you have any questions or if a client needs my guidance. I’m just a call, text, or email away.

📞 Direct Line: 661-291-2222 – Text OK

📞 Cell: 661-714-6258 – Text OK

📞 Office: 661-260-2970 ext. 2222 – Text OK

📧 Email: Mike@AugustaFinancial.com

But wait, there’s more…

Interest Rates

Rates are up slightly, as I mentioned above.

Oktoberfest offers complimentary food and drinks, along with a live band!

Loan Programs

• We do loans on Non-warrantable condos!
• We offer 12-day escrows for pre-approved buyers, including conventional FHA/Jumbo/Bridge loans.
• We provide loans in all 50 states, so call me with anything you need.
• Government loans (FHA/VA/USDA) are in the 5s.
• Conventional loans up to $806,500 are in the high 5’s and low 6s.
• High-balance loans from $806,501 to $1,209,750 are also in the 6’s.
• Jumbo loans above $1,209,750 are in the 6’s.
• ARMS in the 5’s and some in the 6’s
• Bank statement loans are available with 10% down again, with larger down payments in the 6’s++.
• Profit and Loss Statement loans require 20% down - no bank statements needed, only a profit and loss statement!
• 0 down loans are available in the high 6s, with a minimum credit score of 620, up to $1,300,000.
• Private Money lenders offer Hard Money Loans with 35% down.
• No-Ratio Loans require a 30% down payment.
• DSCR (Debt Service Coverage Ratio) loans are available with as little as 15% down.
• Bridge Loans typically have an interest rate of 7.99% with limited fees, helping you get where you need to go!
• 3/2/1 Buydowns, 2/1 Buydowns, and 1/0 Buydowns are available at great starting rates!

Please note that interest rates are subject to change without notice, and the information above reflects LA County Loan Limits.

**Good News for Condos:**   

**Bad News for Condos***     

NOTHING NEW! YAY!

CONDO HELP!!!

If you have a listing or a buyer interested in a specific condo and are unsure whether it is warrantable or Non-warrantable, please call me, and we can look up Fannie’s list in real-time. I have already done that on three condos today, and my list was accurate on all 3. We don’t know when something has changed, and it would be impossible to track everything on a day-by-day basis, but we don’t mind looking up a few items each day.

The full state of California’s naughty list has been added to: MikeMeena.com! See the link below:

https://mikemeena.com/non-warrantable-condos/

Let me know if you hear anything new about condos or townhouses.

I am available every day if you need anything.

📞 Direct Line: 661-291-2222 – Text OK

📞 Cell: 661-714-6258 – Text OK

📞 Office: 661-260-2970 ext. 2222 – Text OK

📧 Email: Mike@AugustaFinancial.com

Have a great day and an even better tomorrow! Please call me when you have a client who needs to borrow!