How low can we go? 30 yr fixed at 3.75% with no fees...

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zubs said:
Why is the 10 year treasury yield going up?

I read this off google and it says this means there is less demand for 10 year treasury bonds, so buying them becomes cheaper, and the yield goes up because the bond is cheaper, and the bond is the same amount after 10 years.

But if no one wants the safe 10 year treasury bond, then why would stocks go down?  Example, I see the NASDAQ dropping due to the 10 yr treasury yield rising.
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tech stocks dropping due to 10 year treasury going to 1.75% is a joke. Look for high quality tech stocks and buy for the long term.
 
zubs said:
Why is the 10 year treasury yield going up?

I read this off google and it says this means there is less demand for 10 year treasury bonds, so buying them becomes cheaper, and the yield goes up because the bond is cheaper, and the bond is the same amount after 10 years.

But if no one wants the safe 10 year treasury bond, then why would stocks go down?  Example, I see the NASDAQ dropping due to the 10 yr treasury yield rising.
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Because borrowing costs go up and banks start charging more for businesses to borrow...which mean business need hard currency to keep its operations afloat.  You cannot just borrow more money.

So things like P/E ratio, hard assets, and revenue matter. 

Additionally, raising yields means inflation, which results in lower growth, higher commodity prices, higher consumer prices, and a lot more savings into bonds. 

Basically, people are afraid that the economy will overheat...prices will go up and then tank growth.

Stocks are also way way too overbought...Tesla is basically the same company it was 18 months ago but its stock prices is like up 1500%...there is no real reason for that other than there is too much cash/money in the market.
 
The raise in interest rates should be interesting on housing especially if SALT cap remains at $10K and mortgage interest deduction capped at $750K mortgage. 

I would imagine that Dems raise or eliminate that cap sometime this year.
 
Irvinecommuter said:
The raise in interest rates should be interesting on housing especially if SALT cap remains at $10K and mortgage interest deduction capped at $750K mortgage. 

I would imagine that Dems raise or eliminate that cap sometime this year.
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I'm not following your comment. Mortgage interest does not hit SALT cap.
 
Cares said:
Irvinecommuter said:
The raise in interest rates should be interesting on housing especially if SALT cap remains at $10K and mortgage interest deduction capped at $750K mortgage. 

I would imagine that Dems raise or eliminate that cap sometime this year.
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I'm not following your comment. Mortgage interest is not impacted by SALT cap.
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GOP capped SALT deduction at $10K and limited interest deduction for the first $750K of a loan...it used to be $1 million.

With housing prices going up...that mean significantly higher property taxes and mortgages.
 
Irvinecommuter said:
zubs said:
Why is the 10 year treasury yield going up?

I read this off google and it says this means there is less demand for 10 year treasury bonds, so buying them becomes cheaper, and the yield goes up because the bond is cheaper, and the bond is the same amount after 10 years.

But if no one wants the safe 10 year treasury bond, then why would stocks go down?  Example, I see the NASDAQ dropping due to the 10 yr treasury yield rising.
Click to expand...

Because borrowing costs go up and banks start charging more for businesses to borrow...which mean business need hard currency to keep its operations afloat.  You cannot just borrow more money.

So things like P/E ratio, hard assets, and revenue matter. 

Additionally, raising yields means inflation, which results in lower growth, higher commodity prices, higher consumer prices, and a lot more savings into bonds. 

Basically, people are afraid that the economy will overheat...prices will go up and then tank growth.

Stocks are also way way too overbought...Tesla is basically the same company it was 18 months ago but its stock prices is like up 1500%...there is no real reason for that other than there is too much cash/money in the market.
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I would argue it depends what services does inflation occur in the most. If its gasoline prices, then you have no choice but to pocket out the cost. But if its services like travel, people may not be willing to eat the cost of that which will mean that inflation wouldn't be as impactful to the economy. The fed seems to believe that the increase in demand may initially be high, but the economy will eventually meet those demands in which case inflation won't be as severe as one would expect. So now you are left with whether or not you believe in the Fed :)
 
sleepy5136 said:
I would argue it depends what services does inflation occur in the most. If its gasoline prices, then you have no choice but to pocket out the cost. But if its services like travel, people may not be willing to eat the cost of that which will mean that inflation wouldn't be as impactful to the economy. The fed seems to believe that the increase in demand may initially be high, but the economy will eventually meet those demands in which case inflation won't be as severe as one would expect. So now you are left with whether or not you believe in the Fed :)
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Yeah...Fed thinks it is temporary while the bond people seem to think it is long term.

The other problem is that we are having a K shape recovery...people on the bottom are seriously hurt by the pandemic and unemployment at the low end is still high.  We have 770K in unemployment filings last week..that's not good at all.

The worst will be people on the bottom getting squeeze by unemployment and inflation...
 
Irvinecommuter said:
sleepy5136 said:
I would argue it depends what services does inflation occur in the most. If its gasoline prices, then you have no choice but to pocket out the cost. But if its services like travel, people may not be willing to eat the cost of that which will mean that inflation wouldn't be as impactful to the economy. The fed seems to believe that the increase in demand may initially be high, but the economy will eventually meet those demands in which case inflation won't be as severe as one would expect. So now you are left with whether or not you believe in the Fed :)
Click to expand...

Yeah...Fed thinks it is temporary while the bond people seem to think it is long term.

The other problem is that we are having a K shape recovery...people on the bottom are seriously hurt by the pandemic and unemployment at the low end is still high.  We have 770K in unemployment filings last week..that's not good at all.

The worst will be people on the bottom getting squeeze by unemployment and inflation...
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Yeah, the pandemic exacerbated the wealth inequality even more. I do think the jobs will come back quicker than previous crisis. Once things start to unlock, the jobs will slowly come back and with the stimulus and unemployment being extended, we should be in good shape to recover quickly.
 
30 Fixed for the most part from banks to mortgage banks are all in the low 3's. Upper 2's are possible if you pay points. Depending on down payment, FICO scores and fees as we know YMMV and rates can range widely.

My .02c
 
Anyone got a HELOC recommendation? We had to close ours down to do our last refi as the online lender didn't want the delays from Wells Fargo in subordinating. I've heard great things about Third Federal and their rate is Prime minus 1% which is lowest I've seen. Only problem for me is that they won't do it for properties held in a trust, which ours is. I've done a little shopping around and USC Credit Union (open for OC residents) offers Prime minus 0.25%. Anyone have any other recommendations?
 
ChiKid24 said:
Anyone got a HELOC recommendation? We had to close ours down to do our last refi as the online lender didn't want the delays from Wells Fargo in subordinating. I've heard great things about Third Federal and their rate is Prime minus 1% which is lowest I've seen. Only problem for me is that they won't do it for properties held in a trust, which ours is. I've done a little shopping around and USC Credit Union (open for OC residents) offers Prime minus 0.25%. Anyone have any other recommendations?
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Those are the 2 lenders that I would recommend for HELOCs as well as PenFed if you want to go up to 85% or 90% LTV.  Why don't you take the property out of the Trust, get the HELOC, and then put it back into the Trust?  It's as easy as a quit claim deed.
 
sleepy5136 said:
Lennar Mortgage quoted me on March 12 3.25% and no additional lender credits. Though they were never competitive to begin with.
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Loan Depot should be able to beat Lennar Mortgage for conforming loans.
 
USCTrojanCPA said:
sleepy5136 said:
Lennar Mortgage quoted me on March 12 3.25% and no additional lender credits. Though they were never competitive to begin with.
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Loan Depot should be able to beat Lennar Mortgage for conforming loans.
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I've heard they are good at refinancing but not for closing on a home since they take forever.
 
sleepy5136 said:
USCTrojanCPA said:
sleepy5136 said:
Lennar Mortgage quoted me on March 12 3.25% and no additional lender credits. Though they were never competitive to begin with.
Click to expand...

Loan Depot should be able to beat Lennar Mortgage for conforming loans.
Click to expand...
I've heard they are good at refinancing but not for closing on a home since they take forever.
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Nope, I have had half a dozen buyers close with Loan Depot without any issues in the past year.
 
sleepy5136 said:
USCTrojanCPA said:
sleepy5136 said:
Lennar Mortgage quoted me on March 12 3.25% and no additional lender credits. Though they were never competitive to begin with.
Click to expand...

Loan Depot should be able to beat Lennar Mortgage for conforming loans.
Click to expand...
I've heard they are good at refinancing but not for closing on a home since they take forever.
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Yup, they were the builder "preferred lender" for a new construction we purchased and they were so bad I ended up going with WF.
 
Interest rates have finally stopping climbing and come down a bit lately so there may be a small window of favorability for refinance and purchase loans.
 
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