The Fed, Rates, and Reverse

Good afternoon,

Mortgage rates have been searching for direction in the past week leading into today's Federal Open Market Committee meeting (FOMC). From this meeting, we learned that The Fed has no intention of tightening credit policy and they continue to be committed to purchasing up to $1.25 trillion of agency mortgage-backed securities. What does this mean? It means short term we expect rates to hang right around where they are right now (there's always a chance for fluctuation). Long term we expect to see rates climb (that's what happens when economic indicators show a growing economy, and there have been some signs of this).

Rates
Currently, the national average for a 30 year fixed mortgage is at about 5.38%, which can still help many people qualify for the purchase or refinance they've been looking for. Plus, that $8,000 tax credit for first-time homebuyers is still available.

No Payments To Make
Lately we have been focusing much of our efforts on reverse mortgages. It has been exciting to help people get out of some financial pickles and dispell some of the myths about these HUD backed and FHA insured products. In fact, did you know you can make a home purchase with a reverse mortgage and never have a single payment?

Please call us to RSVP for our next Reverse Mortgage Seminar coming up on July 1st at 11:30am. Whether you're a consumer, agent, builder, financial planner or another profession, you can greatly benefit from this information.

Thank you
We are blessed to live in such a wonderful area with such great people to do business with. We appreciate you and continually wish you the best. We hope this information is informative. If you have any suggestions of topics to discuss in future emails, please let us know.

Warm regards,

Brett Menzie

An Optimistic Outlook

I thought I would start this edition of my monthly update on a lighter note with a clean joke. Without further ado, I give you The Duck Hunter:

An avid duck hunter was in the market for a new bird dog. His search ended when he found a dog that could actually walk on water to retrieve a duck. Shocked by his find, he was sure none of his friends would ever believe him.

He decided to try to break the news to a friend of his, a pessimist by nature, and invited him to hunt with him and his new dog. As they waited by the shore, a flock of ducks flew by. They fired, and a duck fell. The dog responded and jumped into the water. The dog, however, did not sink but instead walked across the water to retrieve the bird, never getting more than his paws wet. The friend saw everything but did not say a single word.

On the drive home the hunter asked his friend, "Did you notice anything unusual about my new dog?"

"I sure did," responded his friend. "He can't swim."

I led with that joke because I wanted put a humorous spin on this post and illustrate how easy it is to be pessimistic. I was reading a report from the National Association of Realtors that showed data from pending home sales. The report said that pending home sales rose 6.3% in April from the previous month. Now isn't that something to be optimistic about? Rates are still near historic lows and are projected to go up. This news tells me two things, (1) now is the time to buy! & (2) now is the time to refinance!

Robert Brault was quoted as saying "the average pencil is seven inches long, with just a half-inch eraser-in case you thought optimism was dead."

We get excited when we think about all the good things that are out there. If you focus on the positive you will be rewarded with the positive. The negative will take care of itself, it needs no help or energy from us.

As always, you are welcome to call or email me with questions or a custom quote.

Make today the best day you've ever had!

*Brett Menzie*

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Spring Lawn Care Tips - Pressure is on for Nice-looking Yard

Last week, local television station, KSL, had some great spring yard tips. Without further delay, I give you the full story: (http://www.ksl.com/?nid=148&sid=3211738 - Paul Nelson)

With the weather warming up, the pressure is building on homeowners to have the best yards on the block. There are some simple things you could use to keep your yard nice, even though some of them may seem a little nasty.

If you're anything like me, every single front yard on your block looks better than yours. Luckily, we haven't had to do much work on them yet this season because of recent storms. But some gardeners say if you haven't fertilized your lawn already, you'd better get cracking.

Tina Cerling, with Western Garden Center, said, "Actually you can fertilize lawns until it gets really hot in the summer and then you should hold off, because otherwise it will burn."

Cerling says it doesn't matter if you use regular fertilizer or organic, even though the organic kind doesn't have as many chemicals. "They have much smaller numbers [of chemicals] but every bit of it gets used, and they make those numbers up with things like bat guano."

Out of all the guanos out there, bat guano appears to be the "money" guano. Cerling also says you shouldn't go nuts on the mowing. "The idea that mowing it shorter means you don't have to mow it as often is false. You want to leave it long and then that shades the roots, and the roots will grow deeper."

You know, I was looking for an excuse to never mow again, and there it is. Then again, you probably should mow because Cerling says some cities will come out and mow for you, then charge an arm and a leg. But mowing and fertilizer won't solve all your problems.

Down to Earth Landscaping owner Glen Barber said, "People do not treat for the bugs that eat your lawn." Barber says you can use simple stuff around your house to make your yard look nice, like dishwashing soap mixed with water. "The insecticidal soap that you buy from a nursery is very close to spraying Palmolive dish detergent on your lawn."

That keeps aphids away. He also says cayenne pepper and Tabasco sauce keep bugs out. You could also soak a pack of cigarettes in water, and then use that nicotine water to kill insects. Barber says there's enough nicotine in one pack to kill a human, so bugs shouldn't be a problem. But people on the east benches have to deal with another problem: deer.

"Coyote urine, it does work, it works very well. We use it. It's a natural deterrent because they think predators are in the area," Barber said.

Barber says there are some fertilizers made out of human waste that seem to work well. He says he can work with horse manure all day long, but he just can't bring himself to touch the human waste fertilizer.

Watching the Market

The financial markets have been quite volatile this week and in fact ended down for the week. This is bad news for investments and great news for mortgage rates! Now is a great time to purchase or refinance for several reasons with the main one being that rates are still very very very low! (was that enough very's?)

Yesterday I learned that Countrywide has removed themselves from the business of VA Streamlines. This news should give you all the more urgency to get your finances in order and quit putting off that purchase or refinance because you were waiting for rates to bottom out. What programs will be cut next? Who knows. Much of that may have to do with who takes the Presidential office in January 2009. But let us not put off til tomorrow what we can do today.

If you like numbers as much as I do, follow the 10 year bond on the financial ticker at http://money.cnn.com/. The bond price and yield move in opposite directions. Today, the price was up by 18/32 to 100-7/32 and the yield was down to 3.47%. Assuming you have a full income documentation loan with a loan to value of 80% and a FICO of 720, you can generally be in the ballpark of 30 year fixed rates if you add 2% to the treasury yield. Lately though, that 2% has been more like 2.5% because of several factors that would take too long to explain.

So, if you are wondering when rates will fall, have a look at the 10 year bond and specifically the yield and that should give you a pretty good idea. Do not hesitate to call or email me and I would be more than happy to custom tailor a rate quote for your specific scenario.

Do you like great service? You can get it when I help you with your home financing needs. I submitted a loan to processing on Monday of this week and docs are ready today! 5 days is not too shabby.

I hope you learned something because after all, "knowledge is power".

*Brett Menzie* - "Your Loan Guy"

The Road To Financial Freedom

Home Owner's Insurance

After getting a bill today from American Home Mortgage forcing an insurance policy for an annual premium of $2164, I was a little upset because back in November 2007 I changed insurance companies from IDS/Ameriprise to Allstate. My Allstate premium was supposed to be $287 (the forced policy was nine times higher!).

This is what happened. I had my old insurance policy cancel on Nov. 27th 2007 and my new policy was to be effective on Nov. 28th 2007. I found out that insurance companies do their starting and stopping of policies when most of us are in bed... 12:01am. So, the moral of the story is I was charged a prorated one day policy premium of $6 for the lapse in coverage. Always have the two policies overlap!! I am sure glad I do not have to pay the $2164 though.

Let this be a lesson to us all. Afterall, "knowledge is power".

*Brett Menzie* - "Your Loan Guy"