If you don't believe what's going on in the world around us has a daily affect on everyday homeowners, just ponder this: This week, Standard and Poor's Bond rating agency, downgraded Greece's debt to "junk status". Investors jumped out of the market into the safe haven of US bonds and bonds jumped up and rates dropped. Today we are having small correction.
The market is so volatile, I do not feel comfortable allowing any customers to "float" the rate. I suggest that they lock in as soon as they have an address and we have pulled their credit. Yes...they may save an 1/8 if the market drops but the risk that rates may take a big jump up, in one day, far out weighs the possible savings. What does Jim Cramer say? "Bulls and Bears make money, pigs get slaughtered."
I love the deal on our 7/1ARM, a very conservative loan product. I locked a customer in today for 60 days at 4.375% with no points. On a 300K loan the 7/1 ARM would save a borrower about $2,200 per year over the equivalent 30 year fixed.
One more bit of advice, don't put anyone in your car to show home unless they have pre-qualified for the approximate loan amount they need to close the deal. I have seen people with a million dollars in the bank and not qualify for a loan. Today, a borrower needs and income stream. Many self employed customers will not qualify for a loan because they write everything off....a catch 22 for sure, but we do not set the rules. Someday, stated income loans will be back, for the self employed and things may get a little easier but for now these are the card we are dealt.
Please call me to quickly pre-qual your customers. Don't waste your time and gas money driving around someone who cannot qualify. Thanks.
Vince Bacchi
Union Mortgage Group
union-mortgage@atmc.net
910 352 6562 cell
