Debt For Sale.

Are you buying?  The U.S. is selling treasury notes en mass this week, and so far there are lots of eager buyers!  Today for instance, the Fed sold $38 billion worth of 3 year T-notes and the auction went very well.  In fact, demand today exceeded that in the recent past.  Later in the week, we’ll see another $30 billion worth of 10 and 30 year bonds.  It’s anticipated that these auctions will also be well received. 

Some folks wonder at what point will the world’s appetite for U.S. debt be satisfied?  Well, apparently not any time soon.  You see, Treasury debt it backed by the full faith and credit of the U.S. Government which is still considered to be the most powerful financial system in the world.  Foreign and institutional investors find there is no better place to invest apparently, as collectively they purchased over 50% of all the 3 year notes sold today.  This confidence in the U.S. ability to pay it’s obligations is good, because it’s allowing us to continue the life we have all grown used too.  I know some folks would say it’s all bad, but to them I say consider the alternative.  Are you ready for a complete worldwide financial system collapse?  Really??  Instead, let’s better manage our personal budgets asking the government to pay less on our behalf, and over time perhaps we can redefine the government’s role to one we’re more comfortable with (you will have to vote though!).

As a Professional Mortgage Originator my job has become as much that of a credit risk analyst as anything.  I have to look at every file as if I’m an underwriter.  Indeed our application to closed loan ratio is very high here at the Baker and Lindsey Niceville Office relative to the ratio I’ve heard from people at other lenders in the area.  As Superior Home Loans we were able to underwrite many of our own loan files, and if we were to make the wrong decision we would have to pay dearly for it!    There’s nothing like the very real possibility of financial hardship to motivate oneself to be diligent!  As preliminary “credit risk analysts” we make sure we’ve turned over all the rocks so we don’t have surprises.  While these surprises can hurt us, ultimately they can dash the hopes of our clients, and those that refer those clients to us.  Rest assured, we are continually striving to improve our system; from our analysis of risk, to surpassing our client’s expectations of what a mortgage company should be.

Interest rates are holding steady in the low 5’s.  That seems to be the mode of operation in the mortgage interest rate world.  Interest rates continue to hover in the low 5 percent range as all kinds of economic news keeps coming out.  According to Freddie Mac’s “Primary Mortgage Market Survey” interest rates were at their lowest point in April of this year.  Since that time interest rates have bounced around a bit, but have held relatively steady (especially given the market upheaval) at this unbelievably low level.  Have you taken advantage of the low rates yet?  Give us a call, we can help!


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