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After the elections, all we heard was that the Fed would most likely raise rates 2 or 3 times in 2017, maybe more.
The smart money was that the 10-year treasury would yield about 3% by now. Mortgage rates were going to go up!
Not quite, in fact, the 10 year is still below 2.5% and rates ain’t so high. Maybe the smart guys ain’t so smart after all.
Or, maybe things didn’t go as planned with the economy and inflation. I’m sure everyone will have their explanation or should I say opinion on the subject. You know what they about opinions…
Rates are still low by historical standards or any standards for that matter. With the shortage of homes for sale that means two things. Home values will continue to rise and those who were thought to have missed their refinance opportunity still have their shot.
It appears refi’s may not be dead just yet. Many homeowners who may have skipped a refinance because they considered buying a new home may now be rethinking that strategy.
With fewer homes on the market and increased competition for them, some may once again consider a refi. They can do so to reduce their current monthly debt or to take cash out to upgrade and improve their property, or maybe both.
For now, it appears rates may stay low for a while longer, especially in the aftermath of hurricanes Harvey and Irma.
It looks as though the Fed may stay the course with maybe one slighter additional hike later this year. Once again the refi’s are in play but this time around lenders do need to be careful.
Some homeowners may have tried but been declined for a prior refi. Armed with that information, they may reapply attempting to circumvent the issues which caused their denial.
Further with the recent data breaches involving consumer NPPI, identity thieves may attempt refinances on homeowners with good credit who had not previously applied.
I know I’ve said it before, but these low rates won’t last forever (I think). But then again, I’m not one of the smartest guys in the room. So, let’s make hay while the sun shines and get out there and service those who may still want to take advantage of low rates.
There is still some opportunity for refi’s and HELOC’s as homeowner equity is at an all-time high. I’m sure a few more loans in the pipeline won’t hurt.
Not to beat a dead horse (no horses, or any other animals, were harmed in the writing of this blog) but don’t forget your loan quality and compliance. If you’re going to do a loan you might as well do it right. Otherwise, you may be beating a dead horse. It ain’t going anywhere.
