JohnsBlog (articles, news, thoughts, advice)

USDA is once again out of approved funds and the ability to provide financing to those who qualify for the program.  This happens from time to time, and causes extreme inconveniences for buyers everywhere.

All loans going USDA must be submitted ASAP to receive the available funds as lenders will be staggering to reserve monies for their loans.

This is an interesting recurring phenomenon.  USDA is a government sponsored program, and is designed to help individual buyers, aka homeowners, aka the middle class people politicians campaign upon wanting to help.  Yet a few times a year, this program runs out of funds, sometimes destroying a persons dreams, and has in the past taken up to a month or more to get replenished.  Yet we can spend billions on bank takeovers, acquisitions, and salvaging in the blink of an eye...priorities???

While a previous post stated USDA is running low on funds, and this IS true, I have found funding sources for USDA loans that are still taking applications and locking loans.

I learn something new everyday, and today was no exception.  I have a banker backed by one of the larger lenders out there, and in the past when USDA has run out of funds, large lenders (such as Countrywide in the past) simply portfolio'd the loans until USDA's next fiscal year or renewal of funds, then sold them off.

Not sure if that's the situation we're seeing here, but one can certainly hope so.  Regardless, the important thing is that we have a source for today and the foreseeable future (soooo, at least until Monday?). 

A little bit of research and reaching out to different funding sources reminds me that the difference between the average agent or mortgage person and the one who excels is just a little bit of intuition, and the desire to not accept "no" without exhausting every resource available.  More often than not, people can be helped, sometimes you've just got to dig a little bit deeper.

Housing starts are struggling again this month, down for the 3rd month in a row, yet manufacturing and the overall economy is painting a nicer picture than it was a year ago. 

Unemployment is still high, housing market is stagnant at best, and rates are expected to climb and tax credits are set to expire?  This should mean an interesting chain of events over the next couple of months.  The good news is it's an excellent time to buy or refinance with rates low, IF YOU CAN. 

The stock market rising is weird considering unemployment is so high and the housing market is so low, though...guess that stimulus money is helping wall street...but wasn't it supposed to help main street, or was that all lip service?

As posted on www.activerain.com/lemeuss

We've been on a rate roller coaster for the past several months, and it is severely driving the emotions of a lot of people.  Everyone obviously wants the "best" rate, however, in the pursuit of locking in when rates are low, a lot of folks miss out on the more important detail, that being the big picture.

Your likely not refinancing just because you want to see a 4 as the first number in your interest rate.  It's primarily because you're either consolidating debt, freeing up some monthly cashflow, reducing the amount of time it will take to pay down your mortgage, or some other "big picture" reason.  When finances come into play, it's important to focus on this rather than let emotion take over because someone you know got a rate .125% lower. 

Find a good professional that will work with you and your financial network (advisor, attorney, etc...and if you don't have a good advisor get one!) to help you accomplish your long term goals.  Nobody that waits for the lowest possible interest rate ever gets it, because while they're waiting for it to drop, it goes back up.  A couple years ago 6% was a stellar interest rate.  When rates went to 5.875%, there was a mini refi-boom.  Now at 4.75%, we're a full percent lower, however some people still want a lower rate!!  It's all relative folks, and the need to focus on overall benefit and cash analysis to see if a refinance makes sense takes tremendous precedence over who can say they have the lowest rate at the family BBQ. 

While we're at 4.75%, it was just a few weeks ago when we were at 5.25%.  A few weeks from now, we could be up in the mid 5's, as the Fed is scheduled to end their purchases of mortgage backed securities this month.  Everyone knows when there is more supply, there is less demand.  In the case of rates, less demand for securities always always always leads to higher interest rates. 

It's important to get in now during this historic time for interest, and actually let this recession work FOR you in planning for your financial future.  It's a great time for those in position to take advantage of it, so if you are in a good equity position, be sure to get in while the getting in is good!