UPBEAT TIMES • January 2014 • 15 Real Estate Home


THE Mortgage Coach~You, Me and QE3 by Barry O'Meara ~ Comments & ?'s welcome • barryo@stearns.com


of the CFPB was the require- ment of lenders to demonstrate the ability to repay.


This has


been known as the Qualified Mortgage (QM) and has taken the CFPB two years to come up with the “final rule”.


SANTA ROSA, CA. ~ The patch work of policies and leg- islation that have been pieced together to mend our economic ills may be coming to an end. Since 2008, Congress and the Feds have been piecing togeth- er stimulus legislation and car- ried out monetary policies bent on re-starting the economy, building back consumer confi- dence, and shoring up the basic foundation our economy, the housing market.


The Economic Stimulus Act of 2008 was signed into law on February 13, 2008.


The Act


was passed through the House and Senate by an overwhelm- ing majority. The Stimulus Act contained tax breaks, rebates and increased loan limits for home loans backed by Fannie, Freddie and FHA. It was intended to stave off the pend- ing recession that was rippling through the economy from the subprime mortgages and the burst of the housing bubble. The financial markets came to an all out panic in September 2008.


In July 2010 the Dodd-


Frank Act was signed into law.


This act resulted in the creation of the Consumer Financial Protection Bureau (CFPB) filled with regulations designed to protect consumers from unsavory lending prac- tices. Born out of the finan- cial meltdown, the Act has reformed the way credit cards are issued and how credit state- ments are required to be more transparent. Now your credit card statements need to reflect just how insignificant that minimum payment really is. On the home mortgage side


“final rule” goes into effect January 10, 2014. In order for a mortgage to be considered a “qualified mortgage”, there are now much tighter restric- tions on how much debt-to- income ratios can be approved by an underwriter, and the fees charged by the lender or bro- ker.


These tighter restrictions


will limit home buyers abilities to qualify for a home loan. The bond buying of the


Feds will begin tapering in January. QE3 was the third installment in the Feds efforts to curtail the recession and stimulate the economy.


QE3


began in September 2012 with Feds buying mortgage backed securities and Treasury notes at a pace of $85 billion a month. Fears around the taper- ing affected interest rates in June and kicked 30 year rates above 4%. QE3 then contin-


This


ued without any tapering. The whole purpose of the purchase of bonds and mortgages was to keep liquidity in the market and keep interest rates low. This has been very successful for home buyers and home- owners by making homes more affordable and staving off the declining trend in home values. The Federal Reserve has assured the markets that it intends to keep the bench mark rates at near zero, as it reduc- es its aggressive bond buying activity.


Basically, it will be


removing the training wheels in hopes that the free market will be able to ride on its own! The Fed still plans to con- tinue their purchasing of secu- rities, just not as aggressive. I feel long term interest rates will continue to be in the 4’s through 2014, but my crystal ball is a little cloudy.


rates could touch in the 5’s.


Interest It


wasn’t that long ago that quot- ing someone an interest rate of 5.25% was not a bad rate. We just have to get used to it.


HAPPY NEW YEAR!


Strike out Hunger!


Bring in a can of food for the Redwood Empire Food Bank and bowl a game on us.


Offer good any time open lanes are available. May not be combined with other offers. Limit one game per person per day.


www.doubledeckerlanes.com


300 Golf Course Dr. -Rohnert Park, CA 94928 707-585-0226


I find I always have to write something on a steamed mirror. ~Elaine Dundy Dogs Rave About WFC...


I LOVE IT


HERE!


This cute little dog was caught shopping at our store and as you can see is hoping for a treat from one of our customer service representatives. When interviewed, he mentioned that the selection of toys, balls and even the choice of dog food was immense! “It makes it hard to leave!” and...“There’s no other pet food store as friendly as Western Farm Center!”


Fresh Breath for Your Cat & Dog!! Natural Choice


On Sale Now! Dog Food


Now $


Regularly $


49.99 Lamb Meal & Rice Formula Vaccination clinics every Sunday from 9:30am to 11:30 am


Since 1967 we’ve been the favorite place to shop for your pets & farm animals!


Western Farm Center (707) 545-0721


21 West 7th Street • Santa Rosa


www.westernfarmcenter.com Mon-Sat 8am-5:30pm • Sun 9:30am-4pm


UPBEAT TIMES • January 2014 • 15 39.99


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