Your Certified Mortgage Planner — Michael Eiden, Mortgage Blogger

Press Release for Portland, OR Farmers’ Market. Can’t wait for all that local, organically grown produce!!! Not to mention are the artisan stuff.  Summer is right around the corner! yeah!

Portland Farmers Market Growing for 2010 Season

Portland Farmers Market doubles footprint at Saturday PSU Market and opens two new farmers’ markets at Pioneer Courthouse Square and NW 23rd Avenue.

Portland, Ore., January 28, 2010 – Portland Farmers Market, the nonprofit 501(c)6 organization operated by a small staff and numerous volunteers, today announced the opening of two new farmers’ market locations as well as the expansion of the Portland Farmers Market – Saturday at PSU. Beginning this summer, the organization will launch and operate farmers markets at Pioneer Courthouse Square and NW 23rd Avenue. The Saturday PSU market will stretch from SW Montgomery Street to SW Hall Street, doubling the footprint of the popular market.

“Portland Farmers Market wants to build a strong regional food system by ensuring that every city resident has access to high quality, nutritious, locally grown and produced food and appreciates its value in strengthening our local economy,” said Ann Forsthoefel, executive director of Portland Farmers Market.

She added, “We are three huge steps closer to realizing that goal by expanding our Saturday PSU market and opening these two new locations in two of the most vibrant, visited areas of the city.”

More than 450 farmers and food artisans have applied to become vendors at Portland Farmers Market’s six farmers’ market locations for the 2010 season. This is a record number of applications second only to the 2009 season, which is recognized as one of the most successful years for Portland Farmers Market, an independently run organization which receives no ongoing support or funding from government agencies.

Portland Farmers Market – Saturday at PSU: Now Offering More Room to Roam

The Portland Farmers Market – Saturday at PSU, set to open for its 19th season on Saturday, March 20, 2010 – the first day of spring – will expand to include the block directly south of its existing location. Although the Saturday PSU farmers’ market location will double in size, the staff doesn’t plan to double the number of vendor booths. Instead, vendor booths will line up along the perimeter of the South Park Blocks, eliminating the majority of the inner ring of vendors’ stalls formerly packed into the previous market footprint.

Already ranked as one of the world’s best farmers’ markets, the expansion will allow the more than 170 vendors and 16,000 shoppers more space to shop for farm-fresh produce, baked goods, meats, cheeses, seafood and more.

“It’s hard to accommodate 16,000 shoppers hungry for great local produce and specialty foods into one city block during a six-hour time span! The expansion of our Saturday PSU market location will allow for better foot traffic flow and make our visitors’ shopping experience even more enjoyable,” said Jaret Foster, senior market manager of Portland Farmers Market.

Portland’s Living Room Will Become Portland’s Kitchen and Dining Room

Starting the first day of summer, the Rose City’s living room will transform into Portland Farmers Market at

Pioneer Courthouse Square, made possible by Portland’s own Alpha Broadcasting. Every Monday from June 21 to October 25, 2010, more than 32 local farmers and food artisans will take root in the heart of downtown Portland from 10 a.m. to 2 p.m. The more than 26,000 people passing by the Square every Monday will be able enjoy lunch and shop for dinner for 19 consecutive weeks.

“The Square is recognized as the most visited site in Oregon’s most visited city and the ideal community

gathering place. It’s the perfect location for a farmers market!” added Forsthoefel.

Location, Location, Location: NW 23rd Avenue

Noted as one of the prime retail locations in the city, Portland Farmers Market will also open the Portland

Farmers Market at NW 23rd Avenue, on the southeast corner of NW 23rd Avenue and NW Savier Street in a lot generously donated by Con-way Inc. Portland Farmers Market is currently working with the NW Portland community to determine the ideal day and time for this new market. Neighborhood residents will find the bounty of the region right at their doorsteps from June through September.

Forsthoefel shared, “The support and enthusiasm we have received from the NW community has been

tremendous. We are delighted to collaborate with Con-way Inc. in order to bring fresh food to this vibrant area of NW Portland that clearly values the importance of supporting local farmers and food artisans.”

The new locations add to Portland Farmers Market’s three other weekly locations:

• Portland Farmers Market – Wednesday at Shemanski Park, located in the South Park Blocks between SW Park and Salmon
• Portland Farmers Market – Sunday at King Elementary Schoo
• Portland Farmers Market – Thursday at Hinson Church (formerly called Eastbank).

About Portland Farmers Market

Founded in 1992, Portland Farmers Market operates vibrant farmers markets that contribute to the success of local food growers and producers, strengthen the food economy and serve as community gathering places. The local 501(c)6 nonprofit employs five full-time and four part-time employees who manage six weekly farmers’ markets in the Portland area from March until December. The independently-run organization receives no ongoing support from government agencies. More than 26,000 shoppers purchase farm-fresh produce, baked goods, meats, cheeses, seafood and other specialty foods from more than 250 vendors at the height of the season. In addition to operating markets, Portland Farmers Market also serves as an incubator for emerging businesses, a leader of the local food movement, a source of education, a culinary focal point in the community, a cultural destination complete with musical entertainment, and a billboard for Portland’s sustainability movement. To learn more about how Portland Farmers Market aims to grow, nourish and inspire the community, become a Twitter follower, Facebook fan and visit www.portlandfarmersmarket.org.

Last Week:  interest rates on treasuries increased, the 10 yr note yield jumped 12 basis points,, mortgage rates however remained generally unchanged.  The week brought the Greece deficit into full focus early in the week generating a little safe haven buying in treasuries but it didn’t las long as markets quickly realized the European Union would put a plan ion place to keep Greece from defaulting on its debt.  Spain and Portugal are also being observed closely as their financial conditions are not much better than in Greece.

The take away from the revelations that sovereign deb among many  nations is still on the edge of breaking down; not what markets need now as the debate about recover is heating up.  Las week had very little economic releases from which to measure economic conditions.  The week’s major headline was the quarterly refunding by Treasury; it sold $81 billion of 3 yr notes, 10 10 yr notes and 30 yr bonds.  The 10 and 30 yr auctions were not up to recent standards of strong bidding, but were not failures.  China’s decision to increase their bank reserves by 50 basis points was met with concern in the US that Asian countries may try to slow growth rates that have escalated to increase concerns over inflation.

This Week:  unlike las week there are a number of economic report that will draw attention; no Treasury borrowing buy on Thursday treasury will announce the following week’s borrowing, 2 yr notes, 5 yr notes and 7 yr notes will be sold.  Wednesday Jan housing starts and permits, starts will likely be up while we expect permits to have declined after a big jump in Dec.

Most of the economic data this week will be on the manufacturing and business sectors with industrial production and factory use for Jan and the key Philadelphia Fed Business index expected to be a little better.  Interest rates remain tethered to a narrow range for mortgages, moving in a 10 basis point yield range; all focus is on the equity markets with a growing outlook of a major correction coming.  That said, the equity markets have been looking for a correction for the past month but so far… nothing.  A day or two of selling then a day or tow of rallies keeping the key indexes from and serious declines.  It is overdue, we expect the stock market will deliver a huge decline but as long as traders see any decline as a buying opportunity, no bis sell-off is likely.

Market Moving News for this week:

1. Housing Starts and Building Permits (Wednesday)
2. The release of the last month’s FOMC Minutes (Wednesday)
3. Business and consumer inflation figures (Thursday and Friday)

The chart above is a graphical representation of the foreclosures that have been filed in our state of Oregon by county.  At first it doesn’t appear all that bad, however this is for just the month of January. Take a look at the chart below and tell my what you see?

From the chart above we can see that Oregon is ranked 9th.  The media would have you believe this problem is a lot more national… from the chart it’s obvious that it’s not. Nevada, Arizona, California and Florida make up a full 50% of the foreclosure data. 40 states are under the average!

So, this makes a unique problem but also creates opportunity.  Foreclosures are selling like mad across the country and right here in Oregon.  Our higher foreclosure rate has let to some unique buying opportunities.  If you want to buy a foreclosure, here are some sites that can get you started.

• HUDForeclosed.com offers free access to homes
• Foreclclosure.com offers free access to homes
• RealTrac offers free access to homes

Once you have found a list of home you like contact your real estate agent.  As a side note, you are going to want a competent agent.  Negotiating these types of purchases  are not normal so you need an agent with the right experience.  If you need help finding someone, I can get you a few referrals.

I am very familiar with Short Sales, REO (bank owned) and Foreclosures and can arrange for mortgage financing if you are not in the fortunate position to pay cash.  My rates are competitive and we can still close fast even with all the new regulations.

IT’S HUGE!

It’s a good time to look at the 15-year fixed rate mortgages.

As compared to 30-year fixed rates, the relative discount for “going 15″ is big. Interest rate spreads between the benchmark borrowing products haven’t been this high since 2004.

But there’s more to it than just the rates.  The 15-year and 30-year fixed rate mortgages each have their benefits and, because of that, interest rates can be sometimes irrelevant.

For example, assuming a $250,000 mortgage at today’s rates, the lifetime interest costs on a 15-year mortgage are $142,000* less than a comparable 30-year fixed rate mortgage.  That’s pretty significant, but is that the whole story?

The associated 15-year fixed mortgage’s monthly payment registers 41 percent higher than the same 30-year’s.   Big payments like that can break a family’s budget — no matter how low the rate.  Of course, the bigger the loan, the bigger the difference.

Furthermore, low rates don’t matter much with respect to mortgage planning.  There’s a few sounds reasons you may want to pass over the 15-year in favor of a 30:

1. The 15-year mortgage’s tax benefits are relatively tiny
2. There’s opportunity cost in rapidly converting liquid cash into illiquid home equity (opportunity would be, could you earn more on the money than it costs you in interest)
3. In the event of an emergency, you still have to make the larger, 15-year payment (probably one of the biggest drawbacks)

Low rates are tempting, though, and when the spread between the 15-year fixed and 30-year fixed is as big as it is today, the arguments made above lose their weight.  The ultimate test is a gut check.  Does having your mortgage paid off sooner with less interest ’sit right’ with you?  If it does, no amount of number crunching it going to deter you.

One thing to remember is that mortgage rates change everyday and the delta from product-to-product is far from linear.   The chart at top proves it.   So, if you’re not buying a home for another few months, don’t settle in on a strategy just yet.

Know your options, until you are ready to buy that new home.

For help with your mortgage planning needs, feel free to call or send me an email.

*Based on $250,000 borrowed at 5% over 30 years compared to $250,000 at 4.375% over 15 years.

Consumer Sentiment has been on the rise since last February and it’s something to which home buyers should pay attention. 

The affordability of your next home may hinge on consumer confidence.

As the economy recovers from a near-the-brink recession, many of the elements of a full recovery are in place.  Business investment is returning, household spending is expanding, and financial systems are gaining strength. 

Consumer confidence is at a 2-year high.

What’s missing from the recovery, though, is jobs growth.  Another net 20,000 jobs were lost in January. Data like that hinders economic growth.

That said, twenty-thousand jobs lost is a much better figure than the several hundred thousand that were shed per month throughout early-2009, but it’s still a net negative number.  Not only does household income drop when Americans lose jobs but so does the average American’s confidence in his or her own economic future.

This is one reason why jobs growth is so closely watched by Wall Street — jobs are linked to higher confidence levels which, in turn, is believed to spur consumer spending.

Consumer spending represents 70% of the U.S. economy.

As confidence rises, it could be good news for the economy, but bad news for home buyers. More spending expands the economy and, all things equal, that leads mortgage rates higher. 

Same for home prices. More confidence means more buyers which, in turn, squeezes the supply-and-demand curve in favor of sellers.

Later this morning, the University of Michigan will release its February Consumer Sentiment survey. If the reading is higher-than-expected, prepare for mortgage rates to rise and home affordability to worsen.

Foreclosures stories dominate the national housing news. It seems at least one foreclosure-related story makes its way to the front page or the nightly news every week.

But for as much as the foreclosure filing statistics can be astounding — over 300,000 homes were served last month alone — the prevalence of foreclosures depends on where you live.

As reported by RealtyTrac, just 4 states accounted for more than half of the country’s foreclosure-related activity last month.

• California : 22.7 percent of all activity
• Florida : 14.9 percent of all activity
• Arizona : 6.7 percent of all activity
• Illinois : 5.7 percent of all activity

The other 46 states (and Washington D.C.) claimed the remaining 49.9%.

However, just because foreclosures are concentrated geographically, that doesn’t make them less important to homebuyers around the country.  There’s been more than 1.4 million foreclosure filings in the last 12 months and that’s a figure that can’t be ignored.

Distressed properties now play a role in one-third of all home resales.

Therefore, if you’re in the market for a foreclosed home, here’s a few things to keep in mind.

1. Properties are usually sold “as-is” and may not be up to living standards. Be sure to physically inspect the home before buying it.
2. Buying a home from a bank is rarely as streamlined as buying from an individual homeowner. Be prepared for delays and long closings.
3. Foreclosures aren’t always listed for sale publicly. Ask your real estate agent how to access the complete foreclosure inventory.

In order to use the federal homebuyer tax credit, you must be under contract for a home by April 30, 2010 and closed by June 30, 2010.  That doesn’t leave much time to find a bank-owned home and make it to closing.  If you’re serious about buying foreclosures, it’s probably best to start your search soon.

Just a quick post on a cool piece of technology I was introduced to the other day.

So what’s in an email signature? You know… that often neglected sign off to your emails? It’s purpose is to give the reader an easy means to contact you should they have questions. Or, you can use it make a special offer etc… All your info is handy, right in front of them.

Here’s what mine use to look like:

******************************
Michael J. Eiden, CMPS
Certified Mortgage Planner
MORTGAGE EXPRESS
Direct  503.517.2429
Fax      503.517.8548

OR ML#1952 | WA MLO-165229

Useful… but boring. Here’s what my new one looks like:

A little more snazzy right? I thought so too. Even the tabs are clickable right from their email! If you want your own, go to www.emailideas.com and get yours. It’s super easy and best of all free! I would like your thoughts though. Please share below. Which one do you like? Which would you use in your business? Do you use an email signature? Thanks… enjoy your day!

P.S. One side note. If your reader gets text only messages and no html then the new signature will not appear. You will need to add the old text signature underneath your new one, for those that don’t read in html.

The mortgage lending landscape changes a lot.  Rates and guidelines are in constant flux, and it creates preparedness challenges for buyers that aren’t paying in cash.

The loan you get today won’t always be the loan you get tomorrow.

Because of how frequently bank rules are changing, it can be hard for laypersons to distinguish between mortgage fact and fiction of “what’s coming next”.

Recently, we saw this with respect to FHA home loans.

January 20, 2010, the FHA issued a press release with new lending guidelines.  Specifically, it announced 3 changes that will be effective starting April 5, 2010:

1. Upfront mortgage insurance premiums increase from 1.75% to 2.25%
2. Allowable seller concession reduced from 6% to 3%
3. FICO scores of 580 or lower are subject to a minimum 10% downpayment

But, also in its official statement, the FHA announced it would ask Congress for permission to raise monthly mortgage insurance premiums.  This is where the rumors started.

Nestled on page 348 of the Budget of the United States Government, Fiscal Year 2011, in a section titled Special Topics, there is a 1-paragraph notation that details the FHA’s petition.

1. Raise monthly premiums by roughly 0.30%, or $25 per $100,000 borrowed per month
2. Lower upfront mortgage insurance premiums by 1.25%, or $1,250 per $100,000 borrowed at closing

For now, the request is neither approved nor acknowledged by Congress. It’s merely a request. And in the event that Congress does approves it, that doesn’t mean that FHA has to stand by its initial projections.

Truth is, about the only thing we know about the future of FHA lending is that, come April 5, 2010, borrowing money is going to be tougher, and more expensive. These are the facts as we know them today.

Homebuyers should plan accordingly.

The economy’s improving but lending standards are not. Nationally, banks are making mortgage approvals harder to come by.

Underwriting guidelines are tightening.

The data comes from the Federal Reserve’s quarterly survey to its member banks.  The Fed asks senior bank loan officers around the country to report on “prime” residential mortgage guidelines over the most recent 3 months and whether they’ve tightened.

For the period October-December 2009:

• Roughly 1 in 4 banks said guidelines tightened
• Roughly 3 in 4 banks said guidelines were “basically unchanged”

Just 2 of 53 banks said its guidelines had loosened.

Combine the Fed’s survey with recent underwriting updates from the FHA and generally tougher standards for conventional loans and it’s clear that lenders are much more cautious about their loans than they were, say, in 2007.

Today’s home buyers and would-be refinancers face a bevy of new borrowing hurdles including:

• Higher minimum FICO scores
• Larger downpayment requirements for purchases
• Larger equity positions for refinances
• Lower debt-to-income ratios

So, if you’re on the fence about whether now is a good time to buy a home, or make that refi, consider acting sooner rather than later.  It doesn’t necessarily matter that mortgage rates are low, or that there’s an up-to-$8,000 home purchase tax credit for households that qualify.  With each passing quarter, fewer and fewer applicants are eligible to take advantage.

Mortgage markets improved last week on domestic jobs data and international banking concerns. The news triggered buying in the bond market and, as a result, conventional, FHA and VA mortgage rates improved for the 4th consecutive week.

Mortgage rates are now at a 6-week low but probably shouldn’t be.  It underscores just how important global events can be to U.S. mortgage markets.

For example, corporate earnings continue to improve and key elements of the economy are strengthening.  Even the Federal Reserve acknowledges this.  In most circumstances, that would be a boon for the stock markets and bond markets would suffer, including mortgage bonds.

Last week, that wasn’t the case.

Early in the week, as (1) China tightened its monetary policy, (2) Greece did little to quell lingering default fears, and (3) Spain raised its deficit forecasts, global investors sought to reduce their collective risk exposure. For safety of principal, many sold some of their more aggressive positions and moved the cash proceeds into the U.S. bond market — which includes mortgage bonds. 

On Wall Street, this type of trading pattern is called a “flight-to-quality”.  Because mortgage bonds are backed by U.S. government entities, the debt is considered to be ultra-safe.  Last week’s extra demand for bonds helped to push prices up and mortgage rates down.

And that was before Friday’s weak jobs report. Although the Unemployment Rate fell to 9.7%, the government reported a net loss of 98,000 jobs last month and this, too, helped mortgage rates tick lower.

This week, we’ll hope for momentum to continue.

There’s very little domestic news to move rates this week so keep an eye on the global market for similar stories like what we saw last week.  Or, if you’re not sure what to look for, just give me a call or send me an email and I’ll be happy to watch the markets and mortgage rates for you.