Yesterday, Debbie Flinn, Bell Mortgage, Senior Mortgage Advisor, sent me an interesting insight in the form of an email. I believe we all would benefit from her words. So I asked her if I could post her thoughts.

"Yes, it's true, the market has had a huge knee jerk reaction to what Mr. Bernacke has been stating. Our Chairman of the Federal Reserve Board has basically stated that as our economy recovers the Fed's won't have as great a need to stimulate the economy and they will taper off the QE3 program. "Quantitative Easing" (QE) is basically where the Feds have been buying mortgage backed securities (bonds) and giving low low interest rates to make the sluggish economy move. The markets are now making corrections at a rapid rate to be back in the "normal range" of interest rates for current economic conditions. We all know how fast interest rates can move upward and the downward trend is at a much slower pace.

It's a good time to start reviewing all your Pre-Qualification Letters and change the interest rates from the 3's to the 4's. Will your buyer still qualify with the higher interest rate? This is a good time to discuss with your buyer and lender what alternatives you have. Home prices are on the rise and now interest rates are doing the same thing.

Our biggest challenge in the lending world is that the general public doesn't believe that interest rates can go up a full 1%+ in 30 days, and that's exactly what has happened. We are always in an every changing market place and we typically see rates spike in the summer time since the seasonal demand is upon us. Many Americans want to move and get the kids settled into their new school before the school year starts. We are in that peak season. You have already noticed that inventory is tight with multiple offers, and of course, cash offers are king.

Please let me know if I can assist you with your clients mortgage needs.

Sincerely,
Debbie Flinn
Senior Mortgage Advisor NMLS Number 255443 Bell Mortgage
4435 E. Chandler Boulevard | Suite 130 | Phoenix, AZ 85048
480-339-8534 | Fax 602-513-7325
CELL PHONE: 602-430-7541
dflinn@bellbanks.com