All Aboard the Rate Train: Destination Unknown

Are you out there buying a home and your Mortgage Broker is telling you all different rates. Rates varying from 4.875% up to 6% and then back down. I would understand if this type of variation would cause you a little concern and may even cause you to say is this person trying to take me?  The answer is very simple: The market is unstable and has been a rate train without a distinct direction.

Items like oil prices rising 40 + days in a row and job losses appearing to slow down leading to expectations of consumer spending increasing. The largest overlooked factor is the rampant printing of money done by the government. Simple supply and demand here. Increase money supply decrease in the demand. This is especially true from the foreign investor market which is invested heavily in bonds. As the value of the dollar decreases and the other factors increase Inflation becomes a concern. Inflation by definition erodes the value of a fixed income investment ie: bonds.

The Cause: Massive pulling out of the bond market and major sell-off. This is what lead to the sudden hike in the interest rates. That hike scared many of our buyers right out of the market. This is a problem in itself. If buyers vacate the market we will end up with an entirely different problem. We have to have buyers and sales and the inventory is down now but there are many homes in the wing. The banks are releasing these slowly. If they continue to increase the inventory and buyers leave the market oversupply would become an issue. They will not allow this to happen or so I hope. We have already seen them come back down a bit from where they shot too.

Bottom Line: If you are riding the rate train or you are house shopping talk to you lender and ask them to give you a worst case payment. Base what you are shopping for off your worst case pricing. If they go back down get excited and if they stay there you are prepared. Keep in mind that the median home sale in Sacramento County is at 2002 levels. The rates in 2002 were in the high 6% all the way to the mid 7% range. Historically the average fixed rate last time I checked was in the 8% range. Rates have been as high as 18-19% in some cases and homes were still bought. The next time you hear yourself say that is a high rate I urge you to ask yourself  “Compared to What?”

Where have I been? My first uncut video post explains this!

I just wanted to take 3 uncut minutes of your time to let you know where I have been. I can’t wait to get back to my blogging schedule and providing you the useful information that you have grown accustomed too. Please take a minute to watch my newly constructed YouTube work in progress. Thank you all for your patience while I work to bring you the best Mortgage Information in the easiest ways too understand. After all this is California Home Strategies “Real Estate Strategies We All Can Understand.”

California Home Strategies Officially Launches!

I am excited to announce that California Home Strategies is officially launched. It has been a collaborative effort to bring to you “Real Estate Strategies We All Can Understand.”

California Home Strategies will provide the most current mortgage news and finance tips. I will deliver the how to’s of mortgage finance, definitions, product announcements and just straight forward information you can count on.

I am also pleased to let you know that California Home Strategies has lined up several guest bloggers and interviews with supporting business owners. Over the next several months you will find information on the following and much more:

Tax Tips regarding how title is held for married couples in  California

Simple Credit Tips to Manage your FICO score

Common short-sale mistakes and tips to a successful short sale

Tax ramifications on a foreclosure or short sale

Landscape secrets to keep your yard looking fresh

How to balance work and life so that you can enjoy your Home

How to add hours to your day

Strategies for the Real Estate Investor

I will also have free newsletters, e-books, guides to your purchase or refinance , checklists,  market navigation techniques, local statistics, video tips, video tutorials and more. You will not want to miss all the awesome content that will hit this site. Before you leave to day make sure that you sign up for RSS news alerts. You will be notified when new material is published so you don’t miss out.

The lineup of guests is unreal. I have been very fortunate to have some of the industries best agree to contribute and share some of their secrets. We will also have contributors to help you build and maintain your wealth and preserve the equity in your home. College Funding advisors, Financial Planners, Life Insurance, down to your home and auto. I care about much more than just your mortgage. Networking tips and opportunities for you to increase your own business will also be published as my colleagues share their success stories. How they got their business to where it is at today.

I want to take a brief moment to thank Sierra Friend for her instrumental help in the development of this blog from concept to creation to a moving work in progress. I highly recommend checking  her out if you are considering a blog or are looking to take your business to the next level.

Thank you for stopping by today and getting a taste of what California Home Strategies is going to bring to you. Remember, to subscribe before you leave. You will be happy that you did that is my promise and commitment.