Rates may be inching up, but not enough to curb loan volume.
The media’s big question is whether rates will remain around 2020 lows or start to inch up and dampen the housing market. According to most economists and the Fed, the answer is they will continue to hover near record lows. If the last month is any indication, consumers will not let minor rate fluctuations stop them from buying real estate.
Our team is busier than ever. I find clients are more confident now that the election and the presidential transition is behind us, combined with the hope that vaccine distribution is shining light at the end of the tunnel.
Inflation is the elephant in the room.
Inflation may come into play in the second half of the year, and if it does, we could see a more substantial increase in rates. For that reason, I recommend doing a refinance loan now, especially if you are at or above 3.5% on your current loan. Today’s low cost of loans makes refinancing a smart financial move even if there is a half-point difference between the old and new loan.
Banks are getting more aggressive on pricing NON-QM loans.
I mentioned this trend at the beginning of January and have seen even further improvement in pricing. Lenders certainly see the demand and a 5% drop of non-QM’s loans in forbearance or modification since the high in May* has bolstered confidence that self-employed borrowers can continue to make loan payments during these challenging economic times.
Online mortgage lenders are going head-to-head at Super Bowl LV.
Rocket Loans and United Mortgage Wholesalers (UMH) are spending millions to run competing ads touting the same product – a new mortgage broker directory. I took a look at both and found that neither is particularly helpful for real estate professionals or consumers. The Rocket directory is built strictly on location mapping, and UMH is hard to figure out – when I did a search for 90210, the first result was a broker in Long Beach.
I look forward to the evolution of a directory tool based on who is originating and closing business in a defined area. Moreover, online directories will never replace recommendations from real estate professionals and clients who have personal experience working with a broker. We have carefully documented reviews our team has received over the years to make it easy for new clients to verify our service record.
Trust and respect helped us reach new highs in 2020.
I am happy to report that 2020 was a record year for Cohen Financial Group. We originated over 1000 transactions totaling nearly a billion dollars in closed volume.
CEO & Founder, Cohen Financial Group