Hey there - today is a somber day (9-11) - take a moment to be silent and ponder--- Here are today's rates - and some various economic commentaries below. It's a great time to buy or refinance - please let me know how I can be of assistance to you and/or your clients. I look forward to working with you!

Mary Taylor Sales Manager/Sr. Loan Officer Golf Savings Bank Phone: (503) 701-2269 Fax: 1-888-287-1675 metaylor@golfsavingsbank.com

How Does Inflation Impact Interest Rates? If you've seen the news lately, you know that inflation is a very serious issue that will likely be on the rise as the year proceeds. But What Does This Really Mean to You? The bottom line is that as inflation increases, home loan rates will rise too. That's because lenders know that a rise in inflation actually diminishes the value of the money they receive over the life of a loan, as the money they receive for payment simply won't go as far. So when lenders see changes in inflation or even anticipate a rise, they increase their interest rates to make up for the loss in future buying power that will happen as a result of inflation. What Should You Do? Work with a home loan professional who pays close attention to what's going on with inflation-not only with the reports that come out, but also with the concerns that legislators and lenders express. After all, lenders may raise rates to protect their money as soon as they feel the tide turning. More importantly...if you or any of your family, friends, neighbors or co-workers have been considering a purchase or refinance, this is a great time to act as home loan rates could be on the rise.

Mortgage Interest Rates*

Rates as of Friday, 11th September, 2009:

Conforming APR Payment per $1,000 Jumbo APR Payment per $1,000 Conv 30 Yr 4.875% 5.005% $5.29 % 0.000% $0.00 Conv 15 Yr 4.375% 4.501% $4.99 % 0.000% $0.00 Conv 5/1 Arm 3.75% 3.969% $7.27 % 0.000% $0.00 FHA/VA 30 Yr 5.0% 5.131% $5.37 % 0.000% $0.00 FHA 3/1 Arm 3.875% 3.998% $4.70 % 0.000% $0.00

*Rates are subject to change due to market fluctuations and borrower's eligibility.

All loans subject to credit approval and property appraisal. Programs, rates, and terms subject to change without notice. For ARM loans, rate may increase after settlement. Prequalification is not a commitment to lend, a condition of loan approval, or an application for credit. Pre-approvals will result in a loan decision subject to conditions. Consult a tax advisor regarding the deductibility of interest.--

From "Think Big, Work Small"

At 9:55 the U. of Michigan consumer sentiment index, expected better at 67.8 frm 65.7, jumped to 70.2; the expectations index increased from 65.0 two weeks ago to 67.3 and the 12 month out index exploded to 79 frm 69 two weeks ago. Big increases in consumer sentiment but the initial reaction to the data didn't move stocks or interest rates.

At 10:00 July wholesale inventories, expected down 1.0%, were -1.4%; sales were +0.5% and there is a 1.23 months of inventory based on present sales; in June the sales ratio was 1.25 months. The equity markets saw some selling on the release and rate markets improved more.

Later this afternoon at 2:00 Treasury will report its August budget, expectations are for a deficit of $162B for the month.

Atl Fed Pres Lockhart said yesterday the U.S. recovery will probably be "lackluster," hobbled by strains in financial markets and weak consumer spending. Consumers are not, will not spend at levels some in the markets continue to believe; consumer credit has plunged $37.1B in June and July, one of the largest declines since WW II, a clear indication consumers will not buy into the speedy economic rebound. Consumer nest eggs are gone, consumers fear job security, and consumers are increasingly more concerned about saving than anytime in the past 20 years. Not the building blocks for a quick recovery and growth. Don't hear the bulls chanting that consumers account for 70% of GDP growth; the bullish case has to ignore it to continue the run-up in equity markets. All attention is directed to better earnings forecasts from businesses; based primarily on huge cutbacks in expenses and strong outlook in the tech sector.

The bond and mortgage markets continue to benefit from belief the Fed and other central bankers have no plans to increase interest rates for many months as the global economic climate remains very subject with more shoes expected to fall before the financial systems are completely out of the woods. So far we are not even at the edge of the forest. Demand for government securities also increased this morning after a Japanese report today showed the world's second-biggest economy grew less last quarter than earlier estimated. Japan's economy expanded at an annual 2.3% pace in the three months ended June 30, slower than the 3.7% reported last month.

The bellwether 10 yr note has technical resistance at 3.28%, 5 basis points from where we trade this morning; that level has been hit twice and so far has failed to break through it. Once it does fall it will set a move for the 10 yr note to make a run to the 3.10% area taking mortgage rates below 5.00% on 30s; however to get that low we will need a move lower in equity markets.

The remainder of the session likely will be subdued; it is Friday with next week filled with key economic reports (August retail sales the most significant on Tuesday). Four separate reports on the manufacturing and business sector and August housing starts and permits also to be digested.

From Dick Lepre, San Francisco

Thursday September 10, 2009

Initial Jobless Claims were 550,000 which is better that previous and expectation. Ther trade gap widened as "Cash for Clunkers" proved a boon for foreign car manufacturers in August.

Wednesday September 9, 2009

There is still strong demand for Treasuries but yesterday and today it is concentrated at the short (duration) end. The tech for the 30 year remains bearish. This should be indicative of higher mortgage rates. Folks continue to listen to Wall Street and are buying equities. Trusting bunch of folks they must be.

MORTGAGE RATES DOWN SLIGHTLY THIS WEEK

McLean, VA - Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.07 percent for the week ending September 10, 2009, down from last week when it averaged 5.08 percent. Last year at this time, the 30-year FRM averaged 5.93 percent.

The 15-year FRM this week averaged 4.50 percent down from last week when it averaged 4.54 percent. A year ago at this time, the 15-year FRM averaged 5.54 percent.

"Mortgage rates remained historically low over the past two weeks, keeping housing very affordable," said Frank Nothaft, Freddie Mac vice president and chief economist. "As a result, mortgage applications leapt 17 percent over the week ending September 4, led by a 23 percent jump in refinancing demand, according the Mortgage Bankers Association. In fact, nearly three out of five applications were for refinancing current loans.

"While the economy lost 216,000 jobs during August, it was the smallest monthly job loss since August 2008. This and the Federal Reserve's latest "Beige Book" suggest that the economy may be on the road to recovery. Based on information up through late August, most Federal Reserve Bank districts noted that their business contacts remained cautiously positive that economic activity was stabilizing in July and August. Two out of the 12 districts also indicated that local house prices were firming."

Hey there - I hope you have a good Labor Day Weekend. I know that I'll be scrubbing my database and making a huge push for the first time buyers to consider the tax credit and to get ready to buy asap - we don't have much time left if we're going to get folks into their new home by end of November! I'll be getting information arranged and organized on the FHA 203K Renovation Loan - this program will be great to help move the housing inventory that is in need of repair. I used to do a lot of these in years gone by and I see that it's making a comeback. As I provide every week, below the rate sheets are various economic commentaries - rates are still very low so there is no excuse to put off buying. Thanks again for allowing me to provide this info - let me know how I can be of assistance to you over the long weekend.

Mary Taylor Sales Manager/Sr. Loan Officer Golf Savings Bank Phone: (503) 701-2269 Fax: 1-888-287-1675 metaylor@golfsavingsbank.com

New $8,000 Tax Credit for First Time Home Buyers Great news for first time home buyers in 2009! Qualified first time home buyers are eligible for an $8,000 tax credit when buying a primary residence. If you haven't owned a home in the three years prior to closing, congratulations! You are also eligible. Remember, a tax credit is much more valuable than a tax deduction. A tax credit reduces dollar for dollar the amount of tax you owe. A deduction merely reduces the amount of your income that is taxable. Here are two examples of how the tax credit works. You paid $4,000 in taxes. Qualify for the full credit and you get that $4,000 back, plus another $4,000. If you paid no taxes, you get the full $8,000 back in cash - and you don't have to pay it back! Eligible buyers may qualify for a tax credit of up to 10% of the purchase price or $8,000, whichever is less. To qualify for the full credit, the buyer's modified adjusted gross income must be less than $75,000 for single taxpayers and $150,000 for married taxpayers filing a joint return. A partial credit is available for incomes under $95,000 (single) or $170,000 (married). In order to qualify, the $8,000 tax credit is available for qualifying home purchases made before Dec. 1, 2009. This is not a typo. If your closing occurs December 2nd or later, you lose. Want one more reason to act now? Qualified home buyers can apply the credit to either their 2008 or 2009 tax return. To get the credit for 2008, see your tax professional about filing an amended return. For other program requirements, give us a call. We'll run the numbers and see how much you can save.

Mortgage Interest Rates*

Rates as of Friday, 4th September, 2009:

Conforming APR Payment per $1,000 Jumbo APR Payment per $1,000 30-Yr. Fixed 5% 5.131% $5.37 % 0.000% $0.00 15-Yr. Fixed 4.375% 4.598% $7.59 % 0.000% $0.00 3-Yr. ARM - FHA 3.875% 3.998% $4.70 % 0.000% $0.00 30-Yr FHA 5% 5.131% $5.37 % 0.000% $0.00 30-Yr VA 5% 5.131% $5.37 % 0.000% $0.00 5-Yr. ARM - Conv 3.75% 3.872% $4.63 % 0.000% $0.00

*Rates are subject to change due to market fluctuations and borrower's eligibility.

All loans subject to credit approval and property appraisal. Programs, rates, and terms subject to change without notice. For ARM loans, rate may increase after settlement. Prequalification is not a commitment to lend, a condition of loan approval, or an application for credit. Pre-approvals will result in a loan decision subject to conditions. Consult a tax advisor regarding the deductibility of interest.--

You are receiving this email as a result of your ongoing business relationship with Mary Taylor. While beneficial to a wide audience, this information is also commercial in nature and it may contain advertising materials.

UNSUBSCRIBE. In the unlikely event you decide that you would not like to receive this information, please reply to this email with "Remove" in the subject line.

Mary Taylor
Golf Savings Bank
9755 SW Barnes Road Suite 460
Portland, OR 97225

© Copyright 2009. All About News, Inc.

Think Big, Work Small

The initial reaction was as you would expect, a lot of volatility. The stock indexes were trading better ahead of the employment rate and rate markets were being pressured; on the knee jerk the 10 yr note rallied back to unchanged, the stock indexes fell to unchanged. But in 15 minutes the stock indexes were improving while the 10 yr note and mortgages also improved from the initial reaction but were still weaker on the day. The employment report had something for everyone; bears and bulls. The jump in unemployment, a stat done by telephone interviews is troublesome, implying jobs are scarce while the 216K job losses is a lot better than ADP estimates and actually better than what traders were whispering yesterday. Bottom line, the report didn't change a thing; markets continue to believe we can have an economic recovery without the consumer, while the bearish view remains that without the consumer there will be no noticeable recovery. In the meantime stock markets want to shrug off any negativity and keep on kneepan on.

No matter how you slice it, the employment report isn't good news; 9.7% unemployment is seen this morning by some as probably the high in unemployment in this recession. Not a chance in our view, unemployment is very likely to top 10.0% and maybe 10.5% before we see the high. Businesses are not hiring in any significant way and those that are are entry level low income jobs. Recall the geniuses in Washington lead by the President increased the minimum wage two months ago, a drag on hiring. The other side of the debate goes like this; since the number of people losing jobs is slowing to just 200K+ a month businesses will soon begin hiring. After jobs were being cut by 700K a month early this year, chopping 1.6 mil jobs, cutting 200K a month is seen as good news and signs of recovery. Can't keep up cutting jobs by 700K a month or we would be in very deep water. Job cuts obviously had to slow, but new jobs of sizeable numbers is not on the radar for many months. One dude on CNBC this morning, "consumers are back", an ostrich in street clothes. And, we don't have to bring up the recession in housing or consumers up to their bellies in debt and have no desire or ability to borrow more.

This is a very short day; the bond and mortgage markets close at 2:00. The three day weekend will likely keep markets in check. Looking to next week, Treasury will auction $70B of 3 yr, 10 yr and 30 yr debt, always a factor in the rate markets. The stock market, for all the positive spin this morning on the less job losses than were expected, isn't doing much so far.

Dick Lepre, San Francisco

Friday September 4, 2009

BLS Employment Situation Report headlines at -216,000 jobs but revises previous down 49,000 showing -265,000 from the initial previous report. The Unemployment Rate is 9.7%.

Treasuries are selling (higher yields and mortgage rates) but the extent to which they are selling is driven by the fact that the daily tech is substantially overbought. That creates volatility.

BOND YIELDS PUSH MORTGAGE RATES DOWN SLIGHTLY THIS WEEK

McLean, VA - Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.08 percent for the week ending September 3, 2009, down from last week when it averaged 5.14 percent. Last year at this time, the 30-year FRM averaged 6.35 percent.

The 15-year FRM this week averaged 4.54 percent down from last week when it averaged 4.58 percent. A year ago at this time, the 15-year FRM averaged 5.90 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.59 percent this week down from last week when it averaged 4.67 percent. A year ago, the 5-year ARM averaged 5.97

"Bond yields pushed mortgage rates slightly lower this week," said Frank Nothaft, Freddie Mac vice president and chief economist. "Low mortgage rates are helping to keep housing very affordable. Seven of the top eight most affordable months occurred during this year, according to the National Association of Realtors'® (NAR) Housing Affordability Index, which dates back to 1971. As a result, pending sales of existing homes rose for the sixth straight month in July, a trend not seen since the NAR began reporting data in 2001. Moreover, July's sales were the strongest since June 2007.

"Overall, inflation remains in check while certain sectors of the economy are experiencing some improvement. The core price index on consumer expenditures, a key indicator tracked by the Federal Reserve, rose 1.4 percent in July from the same time a year earlier and represented the smallest 12-month increase since October 2003. Meanwhile, the manufacturing industry expanded for the first time in 19 months, according to the Institute of Supply Management."

It's almost the end of summer! Wahh!! I get asked all of the time how we determine interest rates - please review the info below to learn how rates are calculated. Here's a cool new website that you might find interesting - I heard about it this am and will be checking it out - it seems like it has some good content: www.housingmatrix.com As usual below the rate sheet are various commentaries to shed some light on what rates are doing and why. Please let me know how I can be of assistance to your or your clients this coming week. Thanks!

Mary Taylor Sales Manager/Sr. Loan Officer Golf Savings Bank Phone: (503) 701-2269 Fax: 1-888-287-1675 metaylor@golfsavingsbank.com

What's Your Rate? When it comes to buying a home, consumers can no longer shop for a mortgage based simply on lowest interest rate quotes. Today's home buyer needs good advice from an experienced, educated mortgage professional who has the consumer's best interest in mind. For consumers, this means beware of anyone who quotes you an interest rate over the phone or the Internet without asking anything about you, your family, your finances or your lifestyle. Besides market conditions, your mortgage rate is based on a long list of criteria that are unique to your individual financial situation. Look at the list below of 26 different criteria that affect your mortgage rate. How can anyone quote you an interest rate you can trust without a thorough knowledge of your unique financial situation? 1. Loan Amount 2. LTV 3. CLTV 4. Credit Score 5. Credit History 6. Escrow Preference 7. Closing Date 8. Loan Type 9. Property Type 10. Occupancy Type 11. Residency 12. Available Assets 13. Asset Seasoning 14. Co-borrowers 15. Debt Ratio 16. Housing Ratio 17. Improvements Needed 18. Employment Type 19. Employment History 20. Documentation Type 21. Paying Points 22. Length of Loan 23. Relocation 24. Seller Contributions 25. Gifts 26. Cash-out Give us a call. We'll analyze your individual needs and offer you a combination of loan programs and interest rates that makes the most sense for you and your family.

Mortgage Interest Rates*

Rates as of Friday, 28th August, 2009:

Conforming APR Payment per $1,000 Jumbo APR Payment per $1,000 30-Yr. Fixed 5.125% 5.257% $5.44 % 0.000% $0.00 15-Yr. Fixed 4.5% 4.723% $7.65 % 0.000% $0.00 3-Yr. ARM - FHA 4.25% 4.375% $4.92 % 0.000% $0.00 30-Yr FHA 5.25% 5.383% $5.52 % 0.000% $0.00 30-Yr VA 5.25% 5.383% $5.52 % 0.000% $0.00 5-Yr. ARM - Conv 4.0% 4.124% $4.77 % 0.000% $0.00

*Rates are subject to change due to market fluctuations and borrower's eligibility.

All loans subject to credit approval and property appraisal. Programs, rates, and terms subject to change without notice. For ARM loans, rate may increase after settlement. Prequalification is not a commitment to lend, a condition of loan approval, or an application for credit. Pre-approvals will result in a loan decision subject to conditions. Consult a tax advisor regarding the deductibility of interest.-- a Division of National City Bank

You are receiving this email as a result of your ongoing business relationship with Mary Taylor. While beneficial to a wide audience, this information is also commercial in nature and it may contain advertising materials.

UNSUBSCRIBE. In the unlikely event you decide that you would not like to receive this information, please reply to this email with "Remove" in the subject line.

Mary Taylor
Golf Savings Bank
9755 SW Barnes Road Suite 460
Portland, OR 97225

© Copyright 2009. All About News, Inc.
Dick Lepre, San Francisco

II) Fundamentals

Today we have our first peek at how the economy is doing in 3Q2009 and the data shows an economy which is still flat. Personal Income was flat. While inflation - as measured by today's PCE which is +0.1% - is tame the fact is that real wages are declining. I believe that this may become a longer term reality. With so many unemployed and the need to compete with a world economy real wages may well decline for another year or longer. Personal Spending was +0.2% but that is the consequence of the dubious at best "Cash for Clunkers" which compressed sales into the small time frame in which it operated. These auto sales were at the expense of the near future. Considering the cost, I do not believe that this was money well spent. It did not create more auto sales. It moved them in time.

Revised 2ndQ2009 GDP was the same are the preliminary data showing a 1.0% decline in GDP. Initial Jobless Claims were 570,000. The GDP Deflator (a weighted measure of inflation) was flat.

New Home Sales were up 9.6% at 433,000 annualized. Durable Goods Orders ex-Trans were +0.8% (overall was +4.9%).

III) The Technicals

The daily is poised to downcross next week indicative of higher Treasury yields and mortgage rates. The weekly is still bullish.

Think Big, Work Small

Questions increase about interest rate outlooks as the stock market continues to point to economic rebound. With the rate markets focusing primarily on how equity markets perform these days, unless stocks roll over the rate markets are not likely to work lower in rates. It now appears that it will take a market surprise to reverse the current bullish outlook for the economy. Until something more than talk occurs stocks won't buckle; that surprise could be next week's employment report if it shows a big increase in the unemployment rate and larger drop in non-farm job growth---not forecasting it, but whatever the trigger will be the markets won't fall back much without some kind of sentiment change even if it short-lived. Don't know where or what it will be but we believe it will happen in Sept and push mortgage rates to 5.00% and lower.

LOW MORTGAGE RATES HELPING TO STABILIZE HOUSING MARKET

McLean, VA - Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.14 percent for the week ending August 27, 2009, up from last week when it averaged 5.12 percent. Last year at this time, the 30-year FRM averaged 6.40 percent.

The 15-year FRM this week averaged 4.58 percent up from last week when it averaged 4.56 percent. A year ago at this time, the 15-year FRM averaged 5.93 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.67 percent this week, down from last week when it averaged 4.57 percent. A year ago, the 5-year ARM averaged 6.03 percent.

"Long-term mortgage rates were barely changed this week, remaining historically low, which is helping to sustain a high level of affordability in the home-purchase market," said Frank Nothaft, Freddie Mac vice president and chief economist." Low rates contributed to existing home sales rising for the fourth consecutive month to an annual pace of 5.24 million in July, the most since August 2007, according to the National Association of Realtors®.

"Similarly, new home sales rose for the fourth month in a row to 0.4 million, the strongest pace since September 2008, the Commerce Department reported. The sales gain helped to reduce the number of new unsold houses on the market to the lowest amount since March 1993. In addition, house prices in June rose nationally for the second consecutive month, according to the Federal Housing Finance Agency's purchase-only house price index."

Hey there - I wanted to keep you updated on what rates are doing - today's rates are published below - and further down the page are economic commentaries for this week - lots of stuff to stay on top of! Please review and do let me know what questions you might have that I can answer - I'm also happy to offer to do research for you as well - no question is left unturned (for instance I had a question come up this week if we can loan to Felons). Thanks again for allowing me to stay in touch with you - Sincerely, Mary Taylor Golf Savings Bank Sales Manager/Senior Loan Officer 9755 SW Barnes Rd, Suite 460 Portland, Oregon 97225 Direct: 503.701.2269 | Office: 503.291.6540 | Fax: 1-888-287-1675 metaylor@golfsavingsbank.com apply now: http://www.golfsavingsbank.com/loanofficers/marytaylor.htm

Mary Taylor Sales Manager/Sr. Loan Officer Golf Savings Bank Phone: (503) 701-2269 Fax: 1-888-287-1675 metaylor@golfsavingsbank.com

New $8,000 Tax Credit for First Time Home Buyers Great news for first time home buyers in 2009! Qualified first time home buyers are eligible for an $8,000 tax credit when buying a primary residence. If you haven't owned a home in the three years prior to closing, congratulations! You are also eligible. Remember, a tax credit is much more valuable than a tax deduction. A tax credit reduces dollar for dollar the amount of tax you owe. A deduction merely reduces the amount of your income that is taxable. Here are two examples of how the tax credit works. You paid $4,000 in taxes. Qualify for the full credit and you get that $4,000 back, plus another $4,000. If you paid no taxes, you get the full $8,000 back in cash - and you don't have to pay it back! Eligible buyers may qualify for a tax credit of up to 10% of the purchase price or $8,000, whichever is less. To qualify for the full credit, the buyer's modified adjusted gross income must be less than $75,000 for single taxpayers and $150,000 for married taxpayers filing a joint return. A partial credit is available for incomes under $95,000 (single) or $170,000 (married). In order to qualify, the $8,000 tax credit is available for qualifying home purchases made before Dec. 1, 2009. This is not a typo. If your closing occurs December 2nd or later, you lose. Want one more reason to act now? Qualified home buyers can apply the credit to either their 2008 or 2009 tax return. To get the credit for 2008, see your tax professional about filing an amended return. For other program requirements, give us a call. We'll run the numbers and see how much you can save.

Mortgage Interest Rates*

Rates as of Friday, 21st August, 2009:

Conforming APR Payment per $1,000 Jumbo APR Payment per $1,000 30-Yr. Fixed 5.125% 5.257% $5.44 % 0.000% $0.00 15-Yr. Fixed 4.5% 4.723% $7.65 % 0.000% $0.00 3-Yr. ARM - FHA 4.25% 4.375% $4.92 % 0.000% $0.00 30-Yr FHA 5.25% 5.383% $5.52 % 0.000% $0.00 30-Yr VA 5.25% 5.383% $5.52 % 0.000% $0.00 5-Yr. ARM - Conv 4.0% 4.124% $4.77 % 0.000% $0.00

*Rates are subject to change due to market fluctuations and borrower's eligibility.

All loans subject to credit approval and property appraisal. Programs, rates, and terms subject to change without notice. For ARM loans, rate may increase after settlement. Prequalification is not a commitment to lend, a condition of loan approval, or an application for credit. Pre-approvals will result in a loan decision subject to conditions. Consult a tax advisor regarding the deductibility of interest.-- a Division of National City Bank

You are receiving this email as a result of your ongoing business relationship with Mary Taylor. While beneficial to a wide audience, this information is also commercial in nature and it may contain advertising materials.

UNSUBSCRIBE. In the unlikely event you decide that you would not like to receive this information, please reply to this email with "Remove" in the subject line.

Mary Taylor
Golf Savings Bank

,

© Copyright 2009. All About News, Inc.

From "Think Big, Work Small"

The early trade in the equity markets is looking like another better open at 9:30. The only economic release today is at 10:00, July existing home sales are expected to have increased 2.2% to 5.00 mil units (annualized). At 10:00 Fed chief Bernanke is scheduled to speak at the Kansas City Fed annual Jackson Hole symposium. As global economies are coming out of recession (slowly) there is an increasing concern that leaders of G-* countries may begin to turn inward to focus on their economies and away from the joint efforts that helped save the global financial systems. The Jackson Hole meeting is an effort to keep everyone on the same page.

Freddie Mac Weekly Survey:

MORTGAGE RATES DOWN TO LOWEST LEVEL IN THREE MONTHS

McLean, VA - Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.12 percent for the week ending August 20, 2009, down from last week when it averaged 5.29 percent. Last year at this time, the 30-year FRM averaged 6.47 percent.

The 15-year FRM this week averaged 4.56 percent, down from last week when it averaged 4.68 percent. A year ago at this time, the 15-year FRM averaged 6.00 percent.

"U.S. Treasury bond yields fell nearly a quarter of a percentage point over the week, and other long-term yields followed suit," said Frank Nothaft, Freddie Mac vice president and chief economist. "Interest rates on 30-year and 15-year fixed-rate mortgages fell to the lowest level since the end of May, while initial rates on 5/1 hybrid ARMs declined to levels not seen since January 2005.

"Low mortgage rates are helping to reinforce the housing market. New construction on one-family homes rose for the fifth consecutive month in July to an annualized pace of almost 500,000 homes, the most since October 2008. In addition, homebuilder views of housing market conditions for the remainder of the year rose for the second month in a row in August to the most positive reading since June 2008, according to the National Association of Home Builders."

Dick Lepre, San Francisco:

Friday August 21, 2009

It looks as if the technical daily bull cycle will end today. This cycle produced a small dip in rates. Existing Home Sales were +7.2% in July as prices were down 15% y-o-y. 31% of the sales were foreclosures or otherwise "distressed" sales. Housing prices will not stop falling until inventory diminishes. July brought inventory from 8.9 to 8.6 months. There are still a lot of foreclosures to come so while things are getting relatively better it is not as if the problem is about to end soon. What is important is that the market is working.

Thursday August 20, 2009

Initial Jobless Claims were 576,000. The share of mortgages which are delinquent rose to a record 9.24% for 2ndQ2009. While subprime delinquencies and foreclosures may have peaked we are now seeing late payments induced by these job losses.

Treasuries will see record auction levels next week. That may send the daily tech bearish. That would imply that mortgage rates could go up next week.

Topic: FHA Condominium Project Approval Process Reminder

Reminder! As previously announced, FHA has announced significant changes to their requirements for condominiums. The following changes take effect for case numbers ordered on/after 10/1/09:

1. FHA Spot Approvals will be eliminated. Condos MUST be on FHA's approved list to be eligible for FHA financing.

2. Many projects will drop off the approved list on 10/1/09. FHA plans to remove all projects approved prior to 10/1/08 from their approved list. These projects will require re-approval by FHA

3. FHA will limit the concentration of FHA Finance properties in any project to 30% of the total units. Currently, 100% of units in an approved project may have FHA financing. This means that some projects that have been on FHA"s approved list will not be open to any new FHA financed sales. Projects on the approved list will be subject to evidence that not more than 30% of units are FHA financed. This requirement may be met by obtaining certification from the title company. I recommend we request a certification from the title company rather than copies of deeds for the sold units.

Case numbers for any pending transactions should be ordered before 10/1/09