Sep
9
Simple Real Estate Definitions : Quitclaim Deed
Filed Under Favorite Posts, Trivia, Home Sales & Info | Leave a Comment
By its most common definition, a quitclaim deed is a document by which one person passes legal and financial ownership of a home to another person.
It’s also a way for an owner of a home to remove himself from the title to the property.
Often misspelled as “quick claim deed” or “quit claim deed”, quitclaim deeds have a multitude of applications, including:
- Assigning a home to a trust or entity
- Adding a partner to title after marriage
- Removing a partner from title after divorce
In order to quitclaim a property, the grantor must have the legal right to assign the property to a grantee, or else the quitclaim deed is worthless. For example, you can’t quitclaim your interest in City Hall to your neighbor because you don’t actually own City Hall.
This is where quitclaim deeds vary from warranty deeds (or grant deeds) — the types of transfers that occur when real estate is sold. In instances of the former, the title to a home is guaranteed to be clear.
Before using a quitclaim deed on your own home, consult an estate planning attorney. Transferring real property can trigger ruin a will, or trigger taxes — it’s important to consult a professional for help.
Sep
8
What’s Ahead For Mortgage Rates This Week : September 8, 2009
Filed Under Market News, Mortgages, Interest Rates | Leave a Comment
Mortgage markets improved slightly last week overall, but closed out the week much worse from the best levels of the week.
On Wednesday, briefly, mortgage rates touched an 8-week low. Following that, mortgage rates began to climb and stayed on an upward trajectory clear through Friday’s closing.
Rate shoppers suffered, realizing a 0.250 percent rise in rates – roughly $32 per month per $200,000 borrowed.
The biggest story of last week was the U.S. jobs report. It showed the Unemployment Rate climbing to 9.7 percent and a loss of 216,000 jobs nationwide.
Neither figure was a surprise, per se, but Wall Street had visions of a stronger showing. Investors want to see strength in housing and employment and, for now, they’re only getting the former. And so long as the U.S. economic future is unclear, mortgage rates will remain unpredictable.
This week, there isn’t much news, but there are some stories to keep an eye on:
- The Fed’s regional economic summary releases Wednesday. Strength should drive rates up. Weakness should lower them.
- Gas prices are easing, a positive for the economy (and negative for rates) as the Holiday Shopping Season nears
- Two consumer confidence polls are released this week. Confidence can lead to spending, a spur for the economy.
When there’s a lack of economic data, mortgage rates tend to trade on trends. If you’re shopping for a mortgage, watch for developing patterns and be ready to lock at a moment’s notice if mortgage rates are rising — rates tend to worsen with more speed than at they improve.
Sep
4
Why The Day Before Labor Day Weekend Is Tough On Home Affordability
Filed Under Market News, Mortgages, Home Sales & Info, Interest Rates | Leave a Comment
Volume figures to be light on Wall Street today as traders get a head start on Labor Day weekend. It could make shopping for a mortgage a bona fide challenge.
Expect rate volatility this morning and afternoon and, therefore, by extension, expect wild swings in the Home Affordability Index.
As mortgage rates rise and fall, monthly mortgage payments do, too.
The relationship between “vacation days” and mortgage rate volatility stems from 2 facts — (1) Conforming mortgage rates are based on the price of mortgage-backed bonds, and (2) mortgage-backed bonds trade just like stocks. You can’t make a deal without matching a buyer and a seller at a specific price.
With so many traders on vacation today, therefore, there are fewer opportunities to match buyers and sellers. As a result, expect mortgage bond prices to rise and fall with more velocity than on a “normal” day — especially because the August jobs report was just released.
So far this morning, mortgage rates have been jumpy and are higher versus Thursday’s close.
That said, mortgage pricing is fluid, changing every minute of every day. Today, expect those changes to be exaggerated. If you have a chance to lock a favorable rate, consider taking it because, before long, the rate could be gone.
Sep
3
How To Increase Your Household Cashflow By $500 Monthly
Filed Under Favorite Posts, Trivia | Leave a Comment
There are two ways to boost your personal cash flow — increase your income or reduce your spending. The former can be a challenge but the latter doesn’t have to be.
The headline of the above video — “Cut Your Spending By $500 Per Month” — is somewhat sensational but the advice given during the video is spot-on.
From NBC’s The Today Show, the 5-minute piece offers a half-dozen ways to reduce your cash outflows each month, including:
- How to negotiate a lower credit card interest rate
- Why it’s important to go grocery shopping with “a list”
- How to “time” certain purchases like tires, linens, and clothing
It also covers saving money on a family pet.
It’s often easier to save money than to make money. This video shows how easy it can be.
Sep
2
Why Home Prices Are Almost Certain To Rise This Fall
Filed Under Market News, Home Sales & Info | Leave a Comment
In what’s becoming a regular occurrence, housing data blew away economists expectations Tuesday.
As reported by the National Association of Realtors®, the Pending Home Sales Index posted its 6th consecutive monthly gain in July.
After a meteoric rise that started in January, the index is now at its highest levels in more than 2 years.
A “pending home sale” is a home that is under contract to sell, but not yet closed. It’s not the same as an actual home sold, but data shows that nearly 80% of homes under contract close within 2 months and many more close in months 3 and 4.
Home buyers — take note. When the Pending Home Sales Index is rising, it means that market activity has picked up. This can lead to any one, or a combination, of the following:
- Multiple-offer situations
- Reduced negotiation leverage over sellers
- Higher home sale prices with fewer concessions
So, consider yourself alerted. If you’re buying a home in the next several months, expect the recent run in Pending Sales to lead to a run in closed sales, too. That should lead home prices higher in most markets.
Indeed, we’re already seeing it. Case-Shiller says prices are on the upswing.
Sep
1
Another Sign Of Economic Recovery : Consumer Sentiment Rising
Filed Under Market News | Leave a Comment
In a bit of good news for the economy, Consumer Sentiment fell to 4-month lows in August. The drop wasn’t “good news”, per se, but because it wasn’t nearly as large as economists expected, Wall Street cheered it.
The index, jointly published by the University of Michigan and Reuters, measures how Americans feel about their situation today, and how they envision it six months in the future.
Since bottoming 5 months ago, consumer sentiment has added more than 10 points.
Rising Consumer Sentiment figures can foreshadow economic growth because confident consumers are more apt to spend money on big-ticket items including appliances, automobiles, and, of course, new homes.
The recent run of sentiment data is one more reason to believe a full economic recovery is underway.
That said, the Consumer Sentiment survey has its flaws.
For one, the survey’s sample set includes just 500 households nationwide and that’s not a true cross-section of America. And second, just because people feel more confident about their finances doesn’t always mean they’ll spend more money — sometimes, they choose to save.
For now, though, stronger-than-expected sentiment data should help propel both retail sales and home sales volume through the fall season, and may even create some inflationary pressure on the economy.
If these levels are sustained, expect that mortgage rates will rise.
Aug
31
What’s Ahead For Mortgage Rates This Week : August 31, 2009
Filed Under Market News, Mortgages, Interest Rates | Leave a Comment
Mortgage markets were flat last week overall, although mortgage rates were somewhat volatile from day-to-day.
For rate shoppers, the best pricing was available Monday morning and Friday afternoon — everything in between was slightly elevated.
It’s the second consecutive week in which rates finished unchanged.
There was a string of good news last week about the economy, led by housing. New Home Sales, Existing Home Sales, and the Case-Shiller Index all surprised to the high-side and consumer confidence numbers came in higher-than-expected, too.
In prior weeks, strong data like this would have caused mortgage rates to rise. Last week, however, it didn’t. Mostly because foreign demand for mortgage-backed bonds has remained strong.
This week, there’s only one major data release and its timing may prove to be problematic.
Friday, the Bureau of Labor Statistics releases the August Non-Farm Payrolls report. With housing’s rebound seemingly underway, the jobs report takes on added significance. Joblessness can undermine consumer confidence and spending and cause harm to the recovering U.S. economy.
This is one reason why rate shoppers should be cautious toward the end of the week — the jobs report will move markets. The other reason to be cautious is because Friday is the day before Labor Day and Wall Street will be short-staffed.
Fewer traders means more volatility — if rates start to pop, they’ll really pop.
Aug
5
5 Months In A Row : Pending Home Sales Rise Again
Filed Under Market News, Home Sales & Info | Leave a Comment
The number of homes under contract to sell rose in June for the fifth straight month.It’s the Pending Home Sales Index’s longest winning streak since 2003 and another piece of evidence that the housing market may be rebounding.
- The supply of new homes is falling
- The supply of existing homes is falling
- The Case-Shiller Index showed home value increases in many of its markets
Separately, the data is interesting. All together, it paints the portrait of a recovery.
That said, we can’t forget that the Pending Home Sales Index is somewhat unique versus other real estate reports. Whereas data on existing and new home sales measures closed transactions, the Pending Home Sales Index only measures intent to buy.
Just because a home goes under contract, in other words, doesn’t mean that it actually will sell.
Purchase transactions can fall apart for a multitude of reasons including, but not limited to, buyer-seller disputes, failed home inspections, and an inability to secure mortgage financing. The Pending Home Sales Index doesn’t account for these types of issues.
In general, though, as the number of homes under contract increases, Existing Home Sales increase, too — usually on a 2-month lag. Home sale data should remain strong through early-Fall, at least.
For active home buyers, be conscious of the fact that that more home sales plus falling home supplies leads to higher home values. If you’re looking for a bargain, the longer you wait, the less likely you may be to find it.
Aug
4
Where Does The Money Go?
Filed Under Trivia, Market News, Mortgages | Leave a Comment
Where does the money go?If you’re like most U.S. consumers, more than half of it goes to housing and transportation costs.
According to the government’s most recent Consumer Expenditure Survey, spending patterns are little changed from years prior.
More money is spent on entertainment and less money is spent on dining out. Beyond that, the figures are somewhat static.
Meanwhile, using on the survey’s industry-by-industry breakdown, we can see how monthly housing payments and daily commuting costs impact a household’s budget.
For the budget-conscious, going out less often and bargain-shopping can help pad the bottom line, but not as much as living in a less expensive home or moving closer to work.
Even a refinance into lower rates can make a difference.
Aug
3
What’s Ahead For Mortgage Rates This Week : August 3, 2009
Filed Under Market News, Mortgages, Interest Rates | Leave a Comment
Mortgage markets improved last week despite a series of volatile trading sessions.A combination of weaker-than-expected economic data and massive-sized Treasury auctions kept investors guessing and mortgage rates moving.
- Weak data nudged rates lower
- Treasury auctions pushed rates up
By Friday, however, momentum was in favor of lower rates and that’s how the week finished up — slightly more favorable overall.
It’s the second consecutive week in which rates fell.
This week, markets will digest a host of new data. Rate shoppers can expect the volatility to continue.
Monday afternoon, Auto and Truck Sales data is released. We normally don’t track this report, but because of the auto industry’s role in the economy right now, strong numbers should lead to a mortgage bond sell-off, pushing mortgage rates higher.
Then, Tuesday, the Personal Income and Personal Spending report is released as well as the Pending Home Sales Index. Again, strength in the numbers should result in higher mortgage rates.
Thursday, Initial Jobless Claims will get the market’s attention. The data has been trending lower over the past two months and, last week, the rolling, 4-week average posted its lowest mark since January. A reversal in the trend would likely boost the mortgage markets, helping rates to fall.
And, Friday, the jobs report is due.
With unemployment close to 10 percent nationwide and more than 3 million jobs lost this year, investors will respond to “less weak” data with enthusiasm — a bad result for rate shoppers. No matter what the data says, it’s sure to move markets.
