Fannie Mae selling more than they are taking in....

The trough in the mortgage market continues to confirm.  With Fannie Mae clearing inventory and delinquencies declining, the housing recovery has made the turn.

SEM saw various historical indicators earlier this year that support the current findings; however, reality and reporting sources timing is generally off by several months.

With less pressure from legacy issues and improved post closing efficiencies, normalcy will return to our industry.

With the improvements noted above, rates will couple to historical rate setting indexes and acceptable credit guidelines will moderate.

Cal Haupt
Chief Executive Officer
Southeast Mortgage of Georgia, Inc.
770-279-0222
www.southeastmortgage.com

Evaluate the Benefits of Refinancing your Mortgage Before Rates Increase

By Cal Haupt, President and CEO of Southeast Mortgage

 For most of 2012, the average rate on a 30-year fixed mortgage has been falling, reaching new lows in each of the past four weeks. Last week the streak ended and rates rose from 3.49% to 3.55% for 30-year mortgages and increased from 2.80% to 2.83% for 15-year fixed mortgages. I believe that the music is slowing down for the bias towards lower and lower interest rates. If refinancing makes sense for you and your family, now may be the time to take advantage of the events that brought us to these historic lows.

Mortgage rates have been as low as they are for a couple big reasons. Uncertainty about how Europe would handle their debt crisis and our own weakened economy drove investors to buy more Treasury securities. These investments are considered safe, and as the demand for them rises, the yield falls.

The rise in mortgage rates can be attributed to actions taken across the Atlantic, and the drought that’s burning up the breadbasket of the United States. In Europe, Mario Draghi, president of the European Central Bank, outlined a bargain that is taking shape between central bankers and politicians in Europe’s financially troubled countries. The ECB will make outright purchases of their debt under certain conditions in order to maintain price stability and lower the high borrowing rates hurting the European Union’s indebted governments. Draghi’s announcement added upward pressure on Treasury yields, and therefore mortgage rates.

 Dismayed farmers display useless, dried out ears of corn to reporters. Soy suffers, too, as the drought continues. High corn and soy prices will work through the system and raise all food prices. The USDA forecasts food prices rising between 2.5 and 3.5 percent. Food inflation, core inflation from U.S. stimulus activities, along with the ECB’s actions, may be the catalyst towards higher mortgage rates.

J.D. Crowe, Senior Vice President at Southeast Mortgage, wrote about rates, and his client’s decision to refinance, in a previous Thought Leadership column and gave an example of how homeowners can save themselves thousands of dollars by refinancing. With 15-year fixed mortgage rates so low (but potentially rising soon) looking into your situation to determine if you should refinance is a great idea.

When considering the refinance of your mortgage, be sure you are working with a Licensed Mortgage Originator, MLO.  Check http://www.nmlsconsumeraccess.org/  and your State Department of Banking and Finance to ensure the MLO has passed the Federal and State competency exams like all MLOs at Southeast Mortgage.  The benefits must be accurately determined to ensure you make the best decision for you and your family.

The end to bias down in Mortgage Rates - Cal Haupt

With the euro zone issues compounding the post recessionary recovery, the flight to safety provided a bias down in US mortgage rates.

Now ECB President, Mario Draghi, has potentially put the floor in with their mandate to maintain price stability.  Mr. Draghi has made it very clear the euro crisis would not destroy the currency and the ECB would make outright purchases of debt to solidify their objective.

For those that monitor rates and consumers waiting for lower rates, you may have noticed the tick up.  Food inflation due to the heat, core inflation from the US stimulus activities, and the floor put in by Mr. Draghi and the ECB may be the catalyst for a trough in mortgage rates and the turn north.



In my opinion, the music is slowing down for the bottom of the bias down in mortgage rates.  If the benefit to refinancing makes sense for your family, now may be the time to take advantage of the events that got us to this historic low.

Cal Haupt

Chief Executive Officer, Southeast Mortgage

www.southeastmortgage.com

770-279-0222

It's that easy when you take the path less traveled.....

Todd Sheppard, an Executive Mortgage Loan Originator at Southeast Mortgage, discusses why moving to SEM from a larger bank was an excellent move for his ability to close mortgage loans.

- 31 day licensing start to originate
- 130 bps compensation (750,000+ in monthly production)
- Benefits: Medical, 401K with Match
- 8-day Close
- Free Client Relationship Management Group to keep you in touch and build your referrals
- You deserve the best service in the industry

770-279-0222
www.southeastmortgage.com

The True Reason Mortgage Originations are surging - Cal Haupt

One of the important lessons I learned managing a mortgage company through the past three recession/recovery cycles is this:  Consumer Confidence Drives Every Economic Recovery and Mortgage Origination Surge.  http://www.cnbc.com/id/48416744 

The reason is simple.  Consumers that do not feel good about their income stability, government's stability, and their future out look do not purchase no matter what the price.

Last June 2011 the mortgage industry was surging due to consumer confidence.  In July, the government created some uncertainty plunging consumer confidence along with mortgage origination.  Rates were still very low.

July 2012 is setting new records for origination volumes because the stock market is surging and people feel good about the economy and their outlook.

In my history, I have never seen such a favorable mortgage market for people engaged in the industry and the consumer.  Southeast Mortgage is now hiring and training great sales people who have not been in the mortgage business just to handle the surging purchase volume.  Operations continues to deliver great service and fast 8-15 day turn times.  Our commitment to fast turn times and great service will not diminish no matter how large production becomes.  We believed in this in 1993 and it is the cornerstone of our belief system in 2012.

The next 4-5 years should be a mortgage cycle for the record books.

Cal Haupt
Chief Executive Officer
Southeast Mortgage of Georgia, Inc.
www.southeastmortgage.com
770-279-0222

Great Service Matters - You deserve Southeast Mortgage

Service and fast accurate closings are the key to earning Realtor's business.  Word of mouth recommendations referencing real life experience
is why Southeast Mortgage is the largest non-bank lender in Georgia. 
If you cannot close in 15 days, call us at 770-279-0222.  We can help.

Text Version:

Good Morning Cal,

I had a closing just in time yesterday afternoon that resulted in just that. Sitting at the closing table with a realtor I don’t know as the listing agent, she kept crowing about how fast this closing was and could she have my cards to work with me in the future. The Seller was just as excited. The fact that my client delayed getting me documents for the past two weeks had no bearing for them as we closed in 30 days and on the day we said we would. The Seller has a closing today and the person selling her that home has one on Wednesday so Kudos to our Operations Team in making this happen and keeping 3 dreams alive.

Sincerely,

Wharton Smith

Branch Manager, Duluth Office @ NAMAR
NMLS# 185993 GA MLO#26025

Southeast Mortgage
NMLS 103956
770-279-0222 ext 438 office
800-344-8788 ext 438 toll free
770-279-9141 Fax

www.southeastmortgage.com
clientservices@southeastmortgage.com

Why Mortgage Rates Don’t Matter (And Why They Do)

It seems that every day we open our newspapers (or Internet browser) there’s more news of mortgage rates hitting new record lows. In 2011, the record low was 4.45%. Last week, rates dropped to 3.56%. The low rates garner media attention, but they don’t matter to buyers as much as you’d think.

Someone confident in the economy, their own job security, and ready to move into a home of their own is a potential buyer regardless of rates. In the 1990s, the average mortgage rate was 8.2%. It was also the decade of the housing boom. It’s consumer confidence, not rates, that puts buyers into homes.

We can easily look to our history for more evidence that rates don’t make much difference. When rates took a dip in 2011, the media compared it to the low rates of the 1950s and 60s. In the post-WWII economy, pent-up consumer demand fueled economic growth and a housing boom. Mortgage rates in that era averaged from 5.5 to 6%. Low rates weren’t putting people into homes; returning GIs and the baby boom were responsible for the growth in housing.

Even though rates arguably don’t matter to buyers, they should matter more, especially right now. I’ve written in this column before that now is a great time to buy, despite what some naysayers believe. There has never been a time in history when low rates and a still recovering housing market have combined to create the most housing value. Consumers can buy a lot more house for a lot less money over time.

Homeowners with good credit ratings should watch rates as well. Even if there’s no pressing need for you to refinance, with rates as low as they are, it’s a smart financial move. Here’s an example of what homeowners have done, and what you could save: one of our clients purchased a home in May of 2010 with a 5% 30-year fixed interest rate. Say their home cost $200,000. That would mean they’d pay $186,511 in interest over 30 years.

A little over a year later, when rates dropped, the client was able to get a refinance with no closing costs, rolling the initial equity line into the first mortgage and lowering their rate to 4.38%. Eight months after the initial refinance, they were able to refinance again and get a 3.88% rate. A $200,000 home with a 3.88% rate costs $138,777 in interest over 30 years. All told, the client was able to save themselves $47,734.

Unfortunately, consumer confidence remains low. We focus on the fear that comes with buying a home in uncertain times. This is the best time in our history to become a homeowner if you are reasonably confident in your personal economy. The benefits of buying a home in this market should be enough to overcome buyer apprehension.

– J.D. Crowe, Senior Vice President, Southeast Mortgage