The Mortgage Minute, 10.18.2024

The Mortgage Minute 10.18.2024?

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"Greg is great to work with.”—Rebecca C. closed September 2024

The Federal Reserve implemented the first rate cut since 2020 in September, so mortgage rates move considerably higher??

On September 18, 2024, the Federal Reserve cut the Federal Funds Rate for the first time since 2020.? One of the most anticipated cuts in decades, the Federal Funds rate dropped by 50 bps which currently stands in the 4.75%-5% range.? Home Equity Lines of Credit, Credit Cards, and other lending products tied to the Prime Rate saw immediate relief from this action.

Economists were torn between whether the Fed would opt for a smaller 25 bps cut or the larger 50 bp cut.? The general consensus was cutting 50 bps meant the Fed would move aggressively to bring the Federal Funds rate to a “neutral” level.? Since the announcement, inflation readings have improved, down to a year over year rate of 2.4% according to the latest published data.? We’ve also seen a relatively strong employment report and higher than expected retail sales numbers, leading to a selloff in the bond market and significantly higher yields.? The 10 yr Treasury yield up around 40 bps from 3.7% on October 1 to 4.1% on October 17.? This movement has pushed mortgage rates back over 6.6%.

The market has had more than a month to digest the move and range bounds are being retested on the high end.? So, is now the time to refinance?? Possibly.? If your rate is 6.75% or higher, I recommend taking a look at refinance options and consider dropping your term from a 30 year to a 15 or 20 year term.? If you shorten your term, the payment may stay the same or slightly increase but you’ll build equity at a far faster clip and enjoy lower interest rates.?

Generally speaking, a refinance is far simpler than a purchase, namely due to skipping the “down payment sourcing” headache, which is the most likely pain point during the underwriting process of a home purchase.? If you’ve got decent equity, it’s possible we won’t need an appraisal.? For FHA/VA loans, we can engage a “streamline” refinance, which also wouldn’t require an appraisal.

So how do you get the refinance process going?

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We can provide accurate refinance quotes without unnecessarily pulling your credit.? You’ll need the following:

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1. Copy of most recent mortgage statement so we can get an accurate payoff balance
2. Estimated credit score
3. Complete the Opt Out process outlined below (this will prevent you from being bombarded by numerous bad actors in the “lead generation” world):

OPT OUT First Horizon does not sell your information to solicitors, but the credit bureaus often do. ?It’s easy to opt out! ?Opting out should stop trigger leads and pre-screened offers. ?This process can take a few days (up to 5 business days), so if your credit report has already been pulled – this may not block offers immediately.

You can opt out of pre-screened offers for 5 years (or permanently) on the web or by phone.

• On the Web: https://www.optoutprescreen.com/ ?Opt Out Pre-Screen is a joint venture among the three national credit bureaus to allow consumers to control pre-screened offers.
• By Phone:?888-5-OPT-OUT

Add your number to the Do Not Call List! Trigger leads are supposed to be scrubbed against the National Do Not Call list. ?You can add your name to the list by phone or on the web. ? On the Web:?www.donotcall.gov ? By Phone: 888-382-1222

We’re not stifling competition, merely trying to prevent you from facing a barrage of telemarketing calls, texts, emails, smoke signals, and any other disruptive tactic online marketers can devise.

Let’s get your refinance quoted today!

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Greg Williams

AVP/Senior Mortgage Banker

404-457-4143 cell |?

2987 Clairmont Road, Ste 150

Atlanta, GA 30329

NMLS# 151412

https://www.firsthorizon.com/mortgage/greg-williams

Equal Housing Lender

We do Business in Accordance with Federal Fair Lending Laws

UNDER THE FEDERAL FAIR HOUSING ACT, IT IS ILLEGAL, ON THE BASIS OF RACE, COLOR, NATIONAL ORIGIN, RELIGION, SEX, HANDICAP, OR FAMILIAL STATUS (HAVING CHILDREN UNDER THE AGE OF 18), TO:

Deny a loan for the purpose of purchasing, constructing, improving, repairing, or maintaining a dwelling, or to deny any loan secured by a dwelling; or

Discriminate in fixing the amount, interest rate, duration, application procedures, or other terms or conditions of such a loan, or in appraising property.