Fed Leaves Rates Unchanged

With no surprise the Fed did not move to raise the Fed Funds & Discount Rates. They provided rhetoric that inflation remains a concern, there was on descending vote in favor of raising rates. This means we will most likely continue to see a rise in energy and food prices.

Initially mortgage-backed securities were trading lower, meaning higher remortgage rates; hover within forty-five minutes of the announcement rates have gained back their losses and should be unchanged. The volatility continues.

Paul Cantor, (804) 433-1510

Reducing Debt

There is no quick fix to debt reduction; this requires careful planning and implementation. CMPS professionals help you implement these three proven steps to help you achieve financial freedom and become debt-free:

Develop a Debt Reduction Plan of Action:

The best way to approach debt reduction is by re-examining your spending habits and the way your monthly cash flow works. This doesn't necessarily mean that you need to spend less or earn more. It just means that you need to spend your monthly cash flow differently. You see, most people who want to become debt-free, can become debt free if they just manage their cash flow differently.

For example, instead of being forced to dip into your credit cards every time you have an unexpected bill, you should establish a financial reserve account specifically to prepare yourself for unexpected financial obligations. CMPS professionals help you establish a viable plan to re-allocate your monthly cash flow and change your spending habits. This cash flow plan will result in your being financially able to pay cash for everything such as home improvements, cars, furniture, vacations, children's education and other living expenses.

Implement the Plan of Action:

There is a reason that professional athletes have coaches. No matter how good the athlete is, the coach can help keep them accountable in identifying weak spots and improving their performance. You can also benefit by having a team of "financial coaches". CMPS professionals are able to "coach" you in implementing your debt reduction plan. CMPS professionals also work in a team environment with CPAs, CFPs, attorneys and other financial professionals in order to help you better achieve your goals in life.

Review and Modify the Plan of Action:

We all experience changes in our lives that involve our income, career, family, health, lifestyle, etc. CMPS professionals help you review and make modifications to your debt reduction plan as changes arise in your personal and financial situation. Additionally, there may be new types of mortgage planning products and services that could help you enhance your debt reduction plan. The plan review and modification is often referred to as an "Equity Management Review", or an
"Annual Mortgage Review."

If you would lile to conduct an Annual Mortgage Review, contact Paul Cantor at TrustMor Mortgage, call (804) 433-1510 or at www.PaulCantor.com

Weekly Mortgage Rate Commentary For week of June 15, 2008

Inflation fears kicked in last week, driving long-term mortgage rates up significantly. While the core reading of the Consumer Price Index came in at expectations, the headline number rose a stout 0.6%. Additionally, retail sales bounced up 1.0%, almost twice the rate of increase that had been anticipated. While the increase in retail sales certainly bodes well for the economy as a whole, it does increase the likelihood that prices in the economy will see more upward pressure. With inflation already running at the higher end of most economists' comfort range, anything that pushes inflationary pressures higher will likely result in higher mortgage rates, especially longer-term notes.

Next week, the Producer Price Index is due. If we see another higher-than-expected reading in either the headline or core numbers, we'll certainly see mortgage rates continuing to climb. If the readings come in lower-than-expected, we may see mortgage rates back off just a little bit. However, if Industrial Production readings spike, we'll see rates continuing to trend upward for a while.

Mortgage Rate Commentary Week of June 8, 2008

Long-term mortgage rates continued to experience some minor upward pressure last week, while short-term rates dipped a bit. The biggest news of the week was not as big as it could have been. The Labor Department reported that the unemployment rate rose to 5.5% - a jump of 0.5%. While an increase of this scale has not been reported in 33 years, the data came with a note of caution. There has been a large influx of entry-level workers, teens, and college graduates hitting the market. This may have caused some statistic "noise" that skewed the rate. On a more positive note, the economy lost only 49K jobs when 70K or more were expected to have been lost.

With no clear-cut signs of economic momentum one way or the other, we continue to be more concerned with inflationary pressures in the marketplace. At the end of the week, the Consumer Price Index is released. If we get another surprise drop in the core reading, we could see mortgage rates staying flat. However, a higher-than-expected reading would drive mortgage rates upward.

Real Estate Strategy - The Time To Plan Is Now!

Unless you've been living in a cave on a deserted island, you've seen the news and commentary about falling home prices. There is no doubt that the housing market has suffered over the last few years, and may continue to suffer for some time. It has been a rude awakening for most of us to see that housing prices can fluctuate like any other item that can be bought and sold. While most of the media attention of late has focused on the downside of the market, many experts are quietly pointing out that the market will turn. Some believe we may be getting close to that point. Whether discussing income to housing expense ratios, rental income versus mort­gage expenses, or other measures, we will hit a point where the housing market returns to a healthier state. If you have ever thought about real estate investing, or are considering some type of future real estate transac­tion, a down market is a great time to plan. One of the biggest mistakes people can make regarding real estate is to fall in love with a property, for themselves or for an investment, and then find a strategy to go with the home. We have a tendency to look at real estate as a transaction rather than viewing it as an investment strat­egy. The wiser approach is more strategic and has little to do with the individual property. Sitting down and honestly evaluating your financial situation is paramount in the process of buying. For investors, the first step is deciding which type of strategy to execute, from renting to flipping to rehabbing. Developing budgets, exit strategies, and building your team should be next. House hunting starts after the plan is in place.

If you or anyone you know is interested in developing a strategy for real estate investing, or planning for a future change in resi­dence, please seek the advise of an expert mortgage planner to assist in putting a plan in place that maximizes the probability of financial success.

Paul Cantor is a mortgage planner in the Richmond Virginia area. He may be reached at (804) 433-1510 or at www.PaulCantor.com .

Mortgage Rate Commentary, Week of June 1, 2008

While the economy is not looking all that much better, last week's economic news was enough to nudge mortgage rates upward. GDP came in as anticipated at 0.9%. While this number is well below what most economists would call "healthy," it was enough to cause many traders to begin unwinding recession-leaning positions. With another quarter's GDP above zero, the probability of recession becomes even less likely. While this is good economic news, the downside is that any acceleration in the economy is likely to lead to increased inflationary pressure and mortgage rates may creep upward. However, we are not out of the woods yet, and no clear economic direction is set.

This week has two very important economic reports. The week starts with the ISM Manufacturing Index. If this index ticks unexpectedly above 50.0, rates are sure to begin climbing. The week ends with monthly employment data. If the unemployment rate goes up to 5.1% or higher, and more than 45K jobs are lost, we could see mortgage rates flatten, or even slip, slightly as next week begins.

Week of May 25, 2008 Mortgage Rte Commentary

Mortgage rates spent another week moving in a relatively tight range. The minutes from the Fed's most recent meeting were released last week. The comments made it fairly clear that the Fed is done lowering rates. Most analysts now expect the Fed's next move to be an interest rate increase. There is an expectation that this latest round of rate cuts, and all of the government's effort to stimulate the economy, will soon begin to produce additional economic growth. With the inflationary pressures already existing in the market, any additional growth would likely spawn some additional price pressures. This would force the Fed to begin increasing rates. However, this scenario may not happen in the near term. We may spend the summer waiting for some clear economic direction.

This week does contain some significant data. We'll get our first glimpse at the 1st quarter's GDP. If it falls in line with expectations, at just under 1.0%, mortgage rates may stay fairly flat. However, a surprise spike could prod traders into worrying about that future rate hike, with rates moving upward.

Mortgage Rate Commentary Week of May 18, 2008

Last week saw mortgage rates holding fairly steady again. Economic news continues to be mixed, with no real strong indication either for or against future growth. Retail Sales did dip 0.2% in April, but removing autos from the calculation, sales actually rose 0.5°/0. Industrial Product sank more than expected. However, Housing Starts bounded up 8.0%, rather than declining as predicted. The best news of the week was that both the headline and core readings of the Consumer Price Index came in lower than expected. If inflation would moderate just slightly, and housing would pick up, we are likely to see mortgage rates move lower. However, the continued increase in oil prices has many analysts worried that inflation will grow throughout the economy, dragging GDP downward.

Mortgage rates may remain relatively flat again this week with a bit less data due. The biggest news of the week could be the Producer Price Index. If it comes in lower than expected, like the CPI last week, we could see the beginnings of some downward movement in mortgage rates.

A Credit Score Is Just a Credit Score?

Not that long ago, the credit score was a mysterious number. Whether you were shopping for a car, a house, or a credit card, you could be told your score was too low, and you would not be able to get any financing. Alter­nately, the paperwork might be presented to you and all you had to do was sign. Rarewly would you be told your actual score. As time has gone on, and laws have been passed, consumers now know not only what their credit score is, but also what factors are used to create credit scores. Unfortunately, the term "credit score" is used for any model that creates a number indicating your creditworthiness.

Each of the major reporting bureaus has developed their own scores. For example, Experian has a PLUS score, and Equifax offers a ScorePower number. Fair Isaac, the company that developed the classic FICO® score, of­fers multiple types of credit scoring models for its corporate customers. They have developed models specifi­cally for the auto industry, the credit card industry, the banking industry, and they've even built a model that is specific for home equity lending. The variety of credit scores, and the fact that scores can change on a daily
basis, has caused widespread confusion for many people. It is not uncommon for someone to get a credit score online, or from an auto dealer, or somewhere else, and then be shocked when they begin the mortgage buying process because their "credit score" varied significantly from what they thought it was.

The home mortgage industry continues to primarily use the classic FICO® score as the basis of evaluating creditworthiness. Whether you are currently in the market for a mortgage or may be in the future, one of the most important factors is your credit score. Please give me a call at (804) 433-1510 with any questions about your credit, and how we can get the best financing available for you

Mortgage Rate Commentary Week of May 11, 2008

Last week, mortgage rates held steady again as the week's economic indicators continued to reveal an economy that is neither growing nor shrinking. The most positive news of the week was the ISM Services Index surprise 52.0 reading. Any reading over 50 is considered to be a sign of growth in the service segment of the economy. Analysts had expected the index to hold steady around 49.5.

This week has three very important monthly economic reports: Retail Sales, Industrial Production, and the Consumer Price Index, If Retail Sales and Industrial Production both show unexpected signs of strength, we could see some upward movement in mortgage rates. However, the CPT could trump such a situation by coming in lower than anticipated. With inflation fears all over the market, any signs of weakening inflation would be very positive. The bond market would likely rally with mortgage rates stepping down slightly. The worst case for mortgage rates would be a spike in the CPI with great economic news. This might increase the odds of the Fed increasing rates fairly soon.

If you would like to receive weekly market updates via email, contact Paul Cantor, CMPS, TrustMor Mortgage Co., (804) 433-1510 or on the web at www.PaulCantor.com .

Weekly Mortgage Rate Commentary

From some perspectives, last week was a good week for economic data. While there were no clear signs that the economy is rebounding, there were some signs that this economic slump may be short-lived. GDP for the 1st quarter of 2008 came in at a meager 0.6%, which was above what many experts were predicting. More encouraging news came from the labor market. The US economy lost 20,000 jobs, again fewer than most estimates. While most experts were predicting an unchanged or increased unemployment rate, the rate actually ticked down to 5.0%. Other data still points to challenges, but we're seeing some hopeful signs. While the Fed did adjust rates down by a '/4-point, they omitted a phrase from their policy statement indicating they have some optimism for the future.

This week has significantly less data than last week for markets to consume. Mortgage rates may not move too much as we continue to wait for more indications of the economy's health. However, any signs that housing is recovering could spur some investor interest in mortgages and move rates lower.

Paul Cantor ican be reached at (804) 433-1510 or at www.PaulCantor.com.

Mortgage Rate Commentary Week of April 27, 2008

Mortgage rates began trending higher last week, as the limited amount of economic news that came out was not as dire as expected. While the economy continues to run at a sub-par level, there is some evidence that we may not drop as far, or last as long, as some have been predicting. With inflation refusing to behave, signs of stability are increasing the chances that the Fed will stand pat on rates.

This week is huge in terms of important events and data for financial markets. There is a moderate likelihood that the Fed will trim rates another '/4-point on Tuesday. However, this is unlikely to help mortgage rates, as they have been held in check by growing inflationary concerns. We could see mortgage rates begin to climb aggressively if GDP for the 1st quarter comes in above 0.8% or if Friday's Employment Report is much better than expected. Either of these would indicate that the economy might be faring better than thought. This would free the Fed to return to focusing efforts on fighting inflation, which could lead to the possibility of higher interest rates later this year.

It is still a good time to take advantage of historically low home loan rates before more inflation talk pushes them higher. I'm always here to help advise you, your friends, and your colleagues.

Paul Cantor is a mortgage planner at TrustMor Mortgage Campnay. He may be reached at (804) 433-1510 or on the web at www.PaulCantor.com

Richmond, The Perfect Time to Buy a Home.

Is it a good time to buy a home? Is the value of my house going to drop 10, 15, 25 or even 40%? Should I sell my house and move into a rental before the housing market collapses? Are we in a recession? Are mortgage rates going to continue to drop?
These are a few of the questions asked of me on a daily basis these days.

The omnipresent negative media hype has even had me start to wonder about these questions. There is validity to theory that the media has created a self-fulfilling prophecy of declining home values throughout the nation. While other loan officers were fearful for their jobs in the late summer, while the credit crunch was unfolding, I was experiencing very positive feelings, my phone was ringing with calls of concern from past customers and referral sources, truly concerned about my personal situation, this made me realize that what I do and the advise I give does make a positive difference in the lives of those I serve.

The calls are continuing but the subject matter includes request for advice on whether to buy, refinance, and sell, move-up…. I am fortunate to be a mortgage planner practicing in the Richmond market and not in Ft. Lauderdale, San Diego, Detroit, Las Vegas or Fairfax County. The fundamentals of the Richmond area housing market remain strong. Sure homes aren’t selling at the hyper-pace of three years ago, they are selling at a more normalized pace, or as we prefer in Richmond a more civilized pace. Richmond's 2007 unemployment rate averaged out monthly was shy of 3.2%, well below the national average of over 4.5% (when I took macro-economics in college I was taught that a 5% unemployment was equivalent to full employment, due to normal transitions). This is important, when people have jobs and expect continued employment they buy houses. Demonstration of the strength of the Richmond housing market is in most instances anyone who purchased a home two years ago could sell their home for a sizable profit today. Yes there are a few pocket of exceptions, most of which are in neighborhoods where builders have standing unsold inventory of homes and developed building sites.

It is a great time to buy a home. It may not be the best time for someone who has owned a home for less than a year to sell and get out of the market. The media hype and a slower calmer pace of sales provides an outstanding opportunity to buy. Whether buying a first home, investment (rental) property or moving up to a more expensive house, it is time to take action. Mortgage rates remain very low. Sellers are making sales concessions, such as paying all purchaser's closing costs or paying for upgrades and cosmetic changes to homes. The long-term outlook for the Richmond economy is very positive. The current deals often mean it is wise to use bridge financing, to bridge the gap between the sale of a current home to close on a purchase of a new one.

Fannie Mae and Freddie Mac, the private Federally chartered entities that guarantee the majority of mortgage debt in the US have not nor at this point intend to classify the Richmond market as one with declining home values, making great loan options including 100% financing still available to many home buyers

Conversations of people discussing moving and making offers to purchase a new home are now being overheard all over the Richmond area. Recent actions by the Fed have translated to people looking at refinancing and in many cases this has resulted in folks deciding not to refinance but to move-up to a more expensive home. If this activity continues the days of attractive seller concessions will disappear. Builders have slowed down new home starts and are finally clearing out inventories. All this means that Richmond home prices are going to start rising at a faster pace and now is a good time to buy.

How does a seller make sure a home sells quickly? Time and time again hind site shows that a quick sale (not a fire sale) is better for a seller than a long dragged out marketing and listing period. The first piece of advice is to seek expert advice, talk to an experienced reputable Realtor® and loan officer. Do not go into the market pricing your home high and then plan to cut the price a few weeks if the property goes unsold, this looks desperate and typically will not attract additional quality prospects. Talk to both your Realtor® and mortgage lender to see what sales price will still make the numbers work for you on that new purchase. Put some effort in making sure the house is in tiptop shape. Enhance the curb appeal with landscaping; power washing and fresh paint on widows, doors and shutters, De-clutter the interior of the house, especially floors in closets and other surface area. Make sure everything is clean. Additionally it is always a good idea to have a per-sale home inspection and appraisal done; this shows good value and eliminates uncertainties for prospective buyers. Make sure your real estate agent has a good sound marketing plan, extending beyond putting your home in MLS (Multiple Listing Service).

A home is more than a financial investment. While owning almost always makes the best financial sense, the American Dream of home ownership also provides a sense of being a part of a community, pride, stability and security.

In summary it is an ideal time to buy a home in the Richmond market. To maximize the opportunities this market has to offer it is important to seek the expertise of good reliable real estate agent and mortgage professional.

About the author: Paul Cantor is President of TrustMor Mortgage Company in Geln Allen, VA. He is a frequent speaker at local real estate financing forums. He may be reached at (804) 433-1510 or on the web at www.PaulCantor.com.

Mortgage Rate Commentary Week of April 20, 2008

Last week ended with upward pressure beginning to mount on mortgage rates. Economic news was mixed, but hinted that perhaps the downturn will not be as bad, or as long, as many had feared. Both Retail Sales and Industrial Production posted only small gains, but both faired better than expected. Both the Producer and Consumer Prices Indices revealed that inflation is still marching ahead with little sign of abating any time soon. All of this makes the likelihood of a rate cut from the Fed less likely, and many interest rates began to trend upward with these reduced expectations.

We could see mortgage rates holding fairly steady this week as the market prepares for next week's Fed meeting. There are not any major market-moving economic reports due. However, we will get some insight into the housing market with both new and existing home sales data due. Any signs of recovery in the housing market could be met with upward pressure on mortgage rates. If housing data plummets, we may see some downward pressure in hopes of more help from the Fed.

Paul Cantor is a mortgage planner in central Virginia. He may be reached at (804) 433-1510 or at www.PaulCantor.com .

Weekly Mortgage Rate Commentary

Mortgage rates held mostly steady last week as markets appeared to be taking a breather while waiting for next week's onslaught of economic data.

While some calm might be nice for the entire mortgage industry, we could see volatility return this week with the amount of economic data due. This week, we get insight into many segments of the economy. Retail Sales and Industrial Production numbers are due this week with expectations of very little change. If either number spikes higher, we could see mortgage rates moving higher. The best situation for mortgage rates would be to see sluggish results for both readings, with some good inflation news, as both the Consumer and Producer Price Indices are due. After last month's surprise flat CPI core number, another lower CPI reading would be cheered by the market, and we could see mortgage rates trending downward in increased expectations of additional Fed rate cuts. Any major government announcements regarding housing or mortgages programs could send rates either way.

Paul Cantor is a mortgage planner at TrustMor Mortgage Company in central Virginia. he may be reached at (804) 433-1510 or at www.PaulCantor.com .

Buy A Home Or Remodel?

While much of the country is fixated on the problems of the overall housing market, many people are facing a much more personal issue - what to do with their own home when a change is needed. Whether it is the birth of a child, an elderly parent moving in, a job change, or just time for a change, making the decision to move or remodel is rarely an easy one. With the overall housing market not as healthy as it was a few years ago, the questions move beyond the number of bedrooms, the local schools, and local amenities. One must consider how long it may take to sell the home, especially if the needs are pressing. Additionally, will there be improve­ment projects to complete that would make the house easier to sell. Remodeling has its own set of questions, including how long you might need to stay in the home to recoup the investment from a major project.

Whether remodeling or moving is in your near future, some significant mortgage analysis will be required. Two of the most important issues will be the equity in your home and your credit situation. Generally, the more equity in your home, the greater your options become. Your home's equity can be accessed for a remod­eling project either though cash-out refinancing of your current mortgage or a second mortgage or line-of-credit. When selling and buying a new home, your equity can be used for your new home's down payment and closing costs. Your credit situation will impact what type of interest rate you'll pay, how much you can borrow, and the type of loans you should consider. Given current market conditions, an honest and thorough analy­sis of your financial situation should be completed before you get serious about moving or remodeling. Please give me a call to schedule a time for us to meet. I'll help make sure that you understand all the financial options available to you.

Paul Cantor is frquent speaker on local real estate financing issues and may be reached at (804) 433-1510 or at www.PaulCantor.com .

Weekly Mortgage Rate Commentary

Mortgage rates held relatively steady for a second week with weak, but stable, economic news. While we may see some downward pressure this week from the greatest jobs loss reported in five years, the Labor Department reported a much worse than expected loss of 80,000 jobs in March. Last week's ISM Manufacturing Index ticked up slightly. While it is still below 50, which indicates contracting manufacturing, many interpreted the upward bump as positive.

This week is a lighter week in terms of data for markets to digest. The Fed and the compromise bill regarding housing and mortgages being hammered out in Congress will likely dominate this week. The minutes from the Fed's last meeting are due this week, along with speeches from Fed Chair Bernankc and from Fed member Richard Fisher. If we see consensus that the economic challenges can be reversed quickly, we could see some upward pressure develop on rates. If these Fed-related items reveal concerns about prolonged economic challenges, rates may dip a bit. Also watch this week for what's in and what's out in the compromise bill. Rates could be pushed either way.

Paul Cantor is a mortgage planner at TrustMor Mortgage Company in central Virginia. he may be reached at (804) 433-1510 or at www.PaulCantor.com .

Weekly Mortgage Rate Commentary

After weeks of turmoil, mortgage rates were relatively stable last week with no real surprises in economic data or news. While many ideas, bills, regulations and rules were debated last week, we had a quiet week in terms of new government-related programs around housing or mortgages. GDP was left unrevised at 0.6% for the final quarter of 2007. While certainly weak, we did not slip into recession in 2007. Consumer Confidence numbers did drop, as did other measures of consumer attitudes. While the economy is weighing heavy, many experts are expecting attitude measures to continue to decline, especially if gas prices climb to levels predicted by some consumer groups.

The biggest news of this week is likely to be Friday's Employment Report. While there are expectations of another sizable drop in the number of jobs in the US, and another tick upward in the unemployment rate, the market has mostly priced in this bad news and mortgage rates are unlikely to be driven down by a weak report. However, an addition of jobs may drive rates upward quickly.

Many Are Paying More for Mortgages

In response to the current credit markets, the Federal National Mortgage Association, nicknamed Fannie Mae, and the Federal Home Mortgage Corporation, nicknamed Freddie Mac have implemented new credit score (FICO score) and Loan-To-Value (LTV) driven pricing. This makes pricing a loan and comparing pricing on conventional conforming loans even more difficult. Someone with a credit score as high as 719 will pay a premium to obtain a mortgage.

The following are the new price adjustments for vanilla conforming thirty year fixed rate mortgages:

LTV 60.01% to 70%
Credit Score 640 -719 is a 0.500% cost
Credit Score 620 - 639 is a 0.750% cost.

LTV 70.01 or More
Credit Score 680 to 719 is a 0.500% cost
Credit Score 660 - 679 is a 1.250% cost.
Credit Score 640 - 659 is a 1.750% cost
Credit Score 620 - 639 is a 2.500% cost

These costs are to the discount points, one discount point is equal to 1% of the loan amount, and can be translated into the actual rate. Remember the less upfront points the higher the note rate.

This means it is wise to consult with a knowledgeable mortgage professional early on in the purchase or refinance process. The mortgage professional may be able to provide some advise to gain a few points to a FICO score, which means saving thousands of dollars.

Paul Cantor is a mortgage planner in Central Virginia. He may be reached at (804) 433-1510 or at www.PaulCantor.com

Weekly Mortgage Rate Commentary

Long-term mortgage rates were pushed downward last week as the Fed continues to aggressively provide liquidity to the struggling credit markets. The Fed slashed interest rates again by 3/4 of a point and announced direct lending to troubled financial institutions. The Office of Federal Housing Enterprise Oversight (OFHEO) also announced an initiative that should enable Freddie Mac and Fannie Mae to pump $200 billion into the mortgage market. This helped drive rates down, as Freddie and Fannie will be able to buy more loans. Experts expect loans purchases to happen faster now.

We could see long-term mortgage rates continue to drift downward this week as the market continues to absorb the moves from the Fed and OFHEO. While there is no question that the economy has slowed, the question will be whether all the recent efforts to stimulate the economy will have the desired effect, and how quickly it will happen. One downside of this stimulus may be an unwanted jump in inflationary pressures. If inflation springs upward, mortgage rates will start to climb upward.

Paul Cantor is is a mortgage planer at TrustMor Mortgage Company in Geln Allen, VA. He is a frequent speaker at local real estate financing forums. He may be reached at (804) 433-1510. or at www.PaulCantor.com