Mortgage Blog

Well we made it through the first half of the year.
The rate stayed low most of 1st half of 2009 until May 27th.
That wasn’t so bad, was it?I’ll give you my two cents
about the rates. Make sure you don’t bet on anything I say.

I strongly believe that the economy is significantly worse
than what we hear/see on the news. Inflation isn’t an issue
whatsoever since there is wage deflation with the high
unemployment and the cuts in salaries in the private sector
and government salaries amongst the states about to get cut
back(In California, state employees have 15% pay cut till
next year). Unemployment will climb past 10% this year.
We may see over 11% unemployment in California.

So there is a huge contracting in spending coming that will
impact retail real estate as well as the banks. And this
Christmas sale will be an ugly one.

With the introduction of 125 Refi Plus for Fannie Mae and
Freddie Mac loans, there’s some real opportunity for those who
could not refi under CLTV 105%.

So with no inflation emerging and unemployment being a major
issue, I think the rate should go lower from the current level.
The rate should stay around 5% for the economy to recover.