Oct 13 2015 9890 1

Dated: 10/13/2015

Views: 286


Danyal Erickson
Mortgage Loan Originator
NMLS# 1299942
1517 N. Ankeny Blvd, Ste. A
Ankeny, IA 50023
Cell: (515) 491-6861
Office: (515) 965-1707
Fax: (844) 289-7133
derickson@stearns.com
danyalshomeloans.com
For the week of October 12, 2015 – Vol. 13, Issue 41

>> Market Update 

QUOTE OF THE WEEK... "Life is really simple, but we insist on making it complicated." --Confucius, Chinese philosopher 

INFO THAT HITS US WHERE WE LIVE... One of the more interesting reports last week  was the Mortgage Bankers Association's Weekly Mortgage Applications Survey. It showed mortgage applications went up a spectacular 25.5% from the week before. Interestingly, this survey was for the week ending October 2, the day before the government's TRID rules for mortgage lenders went into effect. The new 1,888-page regulation is intended to make the mortgage process clearer to the borrower, a good thing. But it's also expected to lengthen the closing process, which is why many home buyers and refinancers raced to get their applications in before TRID went into effect. 
All of us of course will work as efficiently as possible while complying with the new TRID requirements. In any case, the majority of Americans remain undaunted. Fannie Mae's September Home Purchase Sentiment Index went up 3 points in September, hitting 83.8. The share of respondents saying now is a good time to buy a home went up 1%, to 64%. And the share saying now is a good time to sell increased 5%, to 52%. The realtor.com "Advanced Read of September Trends" found that we've transitioned into a buyer's market. Their chief economist believes that buyers now "should find some relief with lower prices and less competition." 
BUSINESS TIP OF THE WEEK... Successful people stay optimistic. They expect great things to happen every day, treat others as they like to be treated, don't waste time fighting things they can't change, and focus on the job at hand, not on the results they're shooting for.

>> Review of Last Week

ONCE MORE, WITH FEELING... Wall Street investors had such a good time sending stocks higher the week before, they decided last week to do it again. Only this time they put some real gumption into it. The net result? The broadly-based S&P 500 logged its best weekly gain of the year, the Dow posted its best week since February, and the tech-heavy Nasdaq came in with a none-too-shabby 2.6% jump.These performances joined global equity market rallies ignited by rebounding commodity prices. Positive sentiments here received extra impetus when the Fed's last meeting minutes showed central bankers reluctant to raise interest rates due to global risk concerns.
All things economic, however, weren't exactly perfect. The modest amount of data we were exposed to delivered the typical mixed bag of messages. The ISM Services Index dropped from a very healthy 59.0 in August to an unexpected 56.9 in September. But we must remember that one month's data does not a trend make, plus 56.9 is solidly above 50, signaling expansion. Best part of the report was the employment index, which was up for the month. This is very nice to see in the services sector, which supplies around 80% of our jobs. Finally, the Trade Deficit in August ballooned up to $48.3 billion, as exports dipped while imports gained. 
The week ended with the Dow UP 3.7%, to 17084; the S&P 500 UP 3.3%, to 2015; and the Nasdaq UP 2.6%, to 4830.
Bonds ended the week mixed, not bad in light of the strong rally in stocks. The 30YR FNMA 4.0% bond we watch finished the week down .06, at $106.21. Freddie Mac's Primary Mortgage Market Survey for the week ending October 8 showed national average fixed mortgage rates headed lower. Freddie's chief economist tied this to "a more than disappointing September jobs report." Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up to the minute information. 
DID YOU KNOW?...First time buyers are in fact coming back into the housing market. Recent data reported that the share of first time home buyers has moved up to 32%.

>> This Week’s Forecast

RETAIL GROWS, INFLATION SLOWS... The experts expect to see September Retail Sales expand for another month. A good thing, since the consumer is such an important part of the economy. Inflation is forecast to be contracting overall, measured by the Consumer Price Index (CPI). But Core CPI, which excludes volatile food and sinking energy prices, should be up a smidge for September, although not as much as the deflation-fearing Fed wants to see. Both the Philadelphia Fed Index and the NY Empire Index should show manufacturing contracting in those regions.
The stock market is open Columbus Day, October 12, but the bond market is closed.>> The Week’s Economic Indicator CalendarWeaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates. 
Economic Calendar for the Week of Oct 12 – Oct 16
Th
Oct 15
 Date Time (ET) Release For Consensus Prior Impact
Tu
Oct 13
14:00 Federal Budget Sep $95.0B $105.8B Moderate
W
Oct 14
08:30 Producer Price Index (PPI) Sep -0.3% 0.0% Moderate
W
Oct 14
08:30 Retail Sales Sep 0.2% 0.2% HIGH
W
Oct 14
10:00 Business Inventories Aug 0.1% 0.1% Moderate
W
Oct 14
14:00 Fed's Beige Book Oct NA NA Moderate
08:30 Initial Unemployment Claims 10/10 269K 263K Moderate
Th
Oct 15
08:30 Continuing Unemployment Claims 10/3 2.200M 2.204M Moderate
Th
Oct 15
08:30 Consumer Price Index (CPI) Sep -0.2% -0.1% HIGH
Th
Oct 15
08:30 Core CPI Sep 0.1% 0.1% HIGH
Th
Oct 15
08:30 NY Empire Manufacturing Index Oct -8.0 -14.7 Moderate
Th
Oct 15
10:00 Philadelphia Fed Index Oct -1.0 -6.0 HIGH
Th
Oct 15
11:00 Crude Inventories 10/10 NA 3.073M Moderate
F
Oct 16
09:15 Industrial Production Sep -0.2% -0.4% Moderate
F
Oct 16
09:15 Capacity Utilization Sep 77.4% 77.6% Moderate
F
Oct 16
10:00 U. of Michigan Consumer Sentiment Index Oct 88.5 87.2 Moderate
                                                                                                           

>> Federal Reserve Watch   

Forecasting Federal Reserve policy changes in coming months... A slightly higher percentage of economists think the Fed will start hiking rates this year, but the majority do not expect such a move until March. Note: In the lower chart, a 8% probability of change is an 92% certainty the rate will stay the same.

Current Fed Funds Rate: 0%–0.25%

After FOMC meeting on: Consensus
Oct 28 0.00%-0.25%
Dec 16 0.00%-0.25%
Jan 27 0.00%-0.25%

Probability of change from current policy:
      47%
After FOMC meeting on: Consensus
Oct 28       8%
Dec 16       37%
Jan 27
This e-mail is an advertisement for Danyal Erickson. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice, or a commitment to lend. Although the material is deemed to be accurate and reliable, there is no guarantee of its accuracy. The material contained in this message is the property of Stearns Lending, LLC and cannot be reproduced for any use without prior written consent. This message is intended for business professionals only and is not intended for distribution to consumers or other third parties. The material does not represent the opinion of Stearns Lending, LLC. This is not a commitment to lend. Program restrictions apply. Stearns Lending, LLC offers many loan products. Stearns Lending, LLC is a California Limited Liability Company headquartered at 4 Hutton Centre Drive, 10th Floor, Santa Ana, California 92707. (800) 350-LEND (5363) Company NMLS# 1854 (www.nmlsconsumeraccess.org). Stearns Lending, LLC is licensed, registered, or exempt from licensing to conduct business in the following states which require license disclosure on advertising materials: Arizona Mortgage Banker License #0905413; Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act RMLA# 4130495; Georgia Residential Mortgage Licensee #24066; Illinois Residential Mortgage Licensee #MB.6760686; Kansas Licensed Mortgage Company #MC.0025047; Massachusetts Mortgage Lender/Broker License #MC1854; Licensed by the Mississippi Department of Banking and Consumer Finance; Missouri Residential Mortgage Loan Broker License #12-2052; Licensed by the New Hampshire Banking Department; Licensed by the N.J. Department of Banking and Insurance; Rhode Island Licensed Lender; Registered under Texas SML Mortgage Banker Registration; Virginia State Corporation Commission Lender/Broker License #MC-2184; Washington Consumer Loan Company License #CL-1854. For State of Nevada residents Stearns Lending, LLC is a mortgage lender promoting the loan products or services contained in this article; the business phone number that Stearns Lending maintains on file with the State of Nevada Department of Business and Industry is (714) 513-7777. This information is accurate as of July 24, 2015. © 2015 Stearns Lending, LLC All Rights Reserved. 

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