Isn't This How We Got Here?

Here's a fun one (from Mortgage Ledger Newsletter):

The CEO of K. Hovnanian Homes, Ara Hovnanian, recommended to Bloomberg TV that interest rates should be lowered to three percent for the 30-year fixed rate mortgages in 2009 provisionally.

In 2010, the rate would then increase to four percent with the future direction unknown.

Now, I can't believe that Hovnanian is ignorant of how this stuff works, so I want to ask him - who, exactly, should lower the rates? The government? The government, when last I checked, didn't set mortgage rates. The lenders? They can set the rates wherever they like already. Brokers? Brokers take the rates from the lenders.

I suppose, in theory, the government could buy so many mortgage-backed securities that mortgage rates would drop into the 3% range, but I can't see any way to make them stay there, no matter how much money the government spent. And believe me, $700 billion doesn't go anywhere near where you'd have to go to cut rates more than in half, which is what he's talking about.

He went on to say that the major problem in the housing market is affordability. Well, Mr. Hovnanian, you can cure the affordability problem much faster by chopping the prices of your ridiculously overbuilt stock than by spending a few trillion - of other people's money - to game the mortgage market.

Fortunately, the market ignored him. We're trading in a very tight range for the past week. Rates are holding almost steady, but did get fractionally better today.

Incidentally, if you live local to Lehi, you can start looking for my articles in the Lehi Free Press, as I've been asked to write a weekly financial column for them. It's called "Singin' in the Rain". Ideas would be greatly appreciated. I'm gonna get stuck for stuff to say, I just know I am.

Cj
801-310-3407

P.S. Just to remind everyone, we do loans in nearly every state in the Union, all programs that exist, including in-house underwriting of files down to a 540 credit score. We do FHA, VA, and conventional, purchase and refinance, cash-out and rate/term, owner-occupant and investor. If there's a loan program out there for what you're trying to do, we do it, and we do it in-house with our own underwriting. Just so you know.

P.P.S. And we love referrals. A couple of you have asked how to refer people to get them on RateWatch. Easy. Hit reply and give us their email address. Or you can go here and sign them up.

Waiting for the End of the World

Well, okay, no. I'm not.

It might happen, but I'm not going to wait for it. The mortgage industry has stabilized pretty well, albeit with a very, very tiny product line, and we are starting to get market share from the collapse of other brokerages. That's a huge positive for us, and we have to thank Lail Chavez and especially Jonathan Heaton and Skylar Thomas for their referrals. Jonathan is a partner in the office next door, and Skylar became the top referring Realtor in Group history in less than a week. Thanks, guys.

Thought I'd post something about how to refer someone to us. Fact is, the phone is glued to my ear all day. If you are talking to someone that needs to discuss a mortgage with me, here's how the conversation will likely go:

Friend: I really should refinance my house. My rate sucks.

You: You should call this guy I know. He did my loan. He's really good.

Friend: Sounds great, maybe I'll call him.

You: I'll get you his business card.

And that will be the end of it. So If I could suggest something different, could I ask you to try this instead?

Friend: I really should refinance my house. My rate sucks.

You: I know the guy. You go see anyone else, you're crazy.

Friend: Maybe I'll call him.

You: Ha. Good luck with that. Nobody gets through his gatekeepers without a pass. The guy only works by referral. I have a back door, though, because I'm a client. I'll have him call you. He'll take my call.

And THAT'S how you give a referral. Best part of it is, it's true. I really don't take many calls from numbers I don't recognize. If I did, I couldn't get anything done. But if you call me, and you're a client, whatever you need goes to the top of the stack. You really do get special privileges by being a member of the Group. Remember, the Group is family.

Besides, it makes you look good, too. Everyone wants to be the person with the connections, with the pull, who can get things others can't. Well, if you're here, you're one of those people. Use that clout to help your friends.

Please Don't Vote

I mean, don't vote if you don't know what you're voting for.  Don't do it out of some misplaced sense of civic duty.  You don't have to vote.  If you don't know who's running, and/or you don't know anything about the ballot question, please, I beg you, don't vote on that issue.

People splutter at me when I says stuff like this, as if I'm spitting on the Constitution.  As if most of them would know a passage from the Constitution from a line from Sidney Sheldon.

Urging people to vote, even if they don't know one thing about any of the candidates or issues, is exactly like urging people to take medicine - whatever medicine they can lay hands on - regardless of what the medicine is or whether or not they are sick.  Just any random pill will do!  It's your civic duty!

Bull.  It IS your civic duty to know about the issues and the candidates.  It is then your PRIVILEGE to vote.  IF YOU CAN"T BE BOTHERED, PLEASE GET OUT OF THE WAY OF THOSE THAT CAN.