Monday, December 30, 2013

Portland Ranks #1 as Best City in America

The year is not over yet, but Portland takes home first place as America's Best City in 2013!  Here is a link to the report by Movoto: America's 10 Best Cities for 2013.  Below are several categories that were voted on and how Portland ranked in 2013.

1. Portland, OR

Movie Lovers: 1stHealthiest: 6thBest Dressed: 13th
Nerdiest: 2ndMeat Lovers: 6thHardest Working: 13th
Food Lovers: 4thSmartest: 6thHome Buyers: 18th
Funniest: 4thPreppiest: 8thFamily Friendly: 21st
Most Steampunk: 4thMost Exciting: 10thMost Saintly: 34th

Friday, December 20, 2013

Fed Decides to Taper

On Wednesday, the Federal  Open Market Committee and Federal Reserve Chairman Ben Bernanke announced a change to their current bond buying program.  Prior to this announcement the Fed had been purchasing $85 Billion worth of US Treasuries and Mortgage Backed Securities every month.  The announcement today indicates a reduction or “taper” of that purchasing structure by $10 Billion per month.

This does not mean that the Fed will stop subsidizing rates anytime soon, but it does signal an intention to wind down the support program over time.  Rates have moved up about .25% over the last couple of weeks in anticipation of such a move so the immediate impact to rates should not be overly negative from here.  That being said, we should expect higher mortgage rates in 2014 as the economy continues to improve.

Fannie Mae and Freddie Mac have also announced increases to their delivery fee to lenders effective in April of 2014.  That will cause a rate increase of around 0.14.  Due to all of these factors, many economists are targeting a 30yr fixed conventional rate of 5.25% - 5.5% by the end of 2014.   NOW is a great time to buy.

Remember that a 1% increase in loan rate reduces purchasing power by over 10%.  Add that to an expected 5% increase in home prices in the coming year and you have a very compelling reason NOT to wait.

Tuesday, December 17, 2013

Good News for the Economy = Bad News for Interest Rates

Below is a great article by the KCM Crew which explains the current relationship between the economy and mortgage interest rates.  Recent forecasts expect that interest rates will hit 5% in 2014 and this article explains why many have these expectations. The article can be accessed here.

Good News for the Economy = Bad News for Rates

The economy is improving. As an example, the latest employment report showed that the unemployment rate hit a five-year low. We must realize that, as the economic news gets better, the government will consider whether or not to continue the programs they put in place to stimulate the economy. One such program is the Fed’s purchasing of assets which has led to historically low long-term mortgage rates.
Analysts at Capital Economics noted in a recent HousingWire article:
"The 203,000 increase in November's non-farm payrolls, along with the drop in the unemployment rate to a five-year low of 7.0%, gives the Fed all the evidence it needs to begin tapering its asset purchases at the next FOMC meeting later this month."
Whether such ‘tapering’ occurs this month or early next year is questionable. The fact that mortgage rates will spike when it does occur is more a guarantee.
Here are the thoughts of a few Fed presidents regarding whether it is in fact time to cut back on this stimulus program:
“To the extent that key labor market indicators continue to show cumulative improvement, the likelihood of tapering asset purchases will continue to rise. The Committee’s 2012 criterion of substantial improvement in labor markets gets easier and easier to satisfy on a cumulative basis as labor markets continue to heal…Based on labor market data alone, the probability of a reduction in the pace of asset purchases has increased.”
“In my view, we at the Fed should begin tapering back our bond purchases at the earliest opportunity…I consider this strategy desirable on its own merit: I would feel more comfortable were we to remove ourselves as soon as possible from interfering with the normal price-setting functioning of financial markets.”
“I expect discussion about the possibility of reducing the pace of asset purchases. The key issue, in my view, is the extent to which the benefits of further monetary stimulus are likely to outweigh the costs.”
If you are thinking about purchasing a home, buying before the tapering will probably mean a lower mortgage interest rate than if you waited.

Wednesday, December 11, 2013

5 Financial Reasons to Buy a Home

5 Financial Reasons to Buy a Home

Today, the KCM Crew published an article that summarizes Eric Belsky, Managing Director of the Joint Center of Housing Studies at Harvard University, paper on homeownership.  His paper can be accessed here: The Dream Lives On: the Future of Homeownership in America.  Below is the summary.
1.) Housing is typically the one leveraged investment available. 
“Few households are interested in borrowing money to buy stocks and bonds and few lenders are willing to lend them the money. As a result, homeownership allows households to amplify any appreciation on the value of their homes by a leverage factor. Even a hefty 20 percent down payment results in a leverage factor of five so that every percentage point rise in the value of the home is a 5 percent return on their equity. With many buyers putting 10 percent or less down, their leverage factor is 10 or more.”
2.) You're paying for housing whether you own or rent. 
“Homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord.”
3.) Owning is usually a form of “forced savings”.
“Since many people have trouble saving and have to make a housing payment one way or the other, owning a home can overcome people’s tendency to defer savings to another day.”
4.) There are substantial tax benefits to owning. 
“Homeowners are able to deduct mortgage interest and property taxes from income...On top of all this, capital gains up to $250,000 are excluded from income for single filers and up to $500,000 for married couples if they sell their homes for a gain.”
5.) Owning is a hedge against inflation.
“Housing costs and rents have tended over most time periods to go up at or higher than the rate of inflation, making owning an attractive proposition.”

Bottom Line

We realize that homeownership makes sense for many Americans for many social and family reasons. It also makes sense financially.

Tuesday, December 10, 2013

December YouMagazine

YOU Magazine - December 2013
YOU Magazine
Clayton Scott     Clayton Scott
Branch Manager/Mortgage Consultant
Phone: 503-497-5060
Fax: 503-497-5264
License: 754407
December 2013

November 2013
October 2013
September 2013
August 2013
July 2013
June 2013

Yellen Supports Stimulus Efforts
Likely Incoming Fed Chief Says Economy Still Needs Boost

In mid-November, Janet Yellen, President Obama's choice to replace Federal Reserve Chief Ben Bernanke, indicated that she would likely continue with the Fed's economic stimulus efforts, known as Quantitative Easing.

   Yellen Supports Stimulus EffortsLikely Incoming Fed Chief Says Economy Still Needs Boost
Holiday Party Favorites
Host Like a Pro with These Easy Recipes

Get your party going with a fabulous Hummus dip, Stuffed Mushrooms hors d'oeuvres and a fast, spiced holiday punch.

   Holiday Party FavoritesHost Like a Pro with These Easy Recipes
Beware of Typhoon Disaster-Relief Scams
Take these steps to make sure your donations to help victims in the Philippines go to reputable organizations.
By Cameron Huddleston,

If you're considering donating to relief efforts for victims of the Philippines typhoon disaster, watch out for con artists trying to prey on your generosity. The Federal Trade Commission and Better Business Bureau are warning consumers to beware of scams related to Typhoon Haiyan and to make sure their donations are going to reputable organizations.

   Beware of Typhoon Disaster-Relief ScamsTake these steps to make sure your donations to help victims in the Philippines go to reputable organizations. By Cameron Huddleston,
Resolution Relief for the New Year
Lose More Weight With Less Exercise, Study Says

If getting into a gym routine has been on your list of New Year's resolutions for the last few years, and still you've only managed to darken the belt of a treadmill a couple times since, isn't it high time we asked: who really wants to spend an hour or more at the gym, anyway?

   Resolution Relief for the New YearLose More Weight With Less Exercise, Study Says
What's Your Ideal Day?
By Jason Womack

As everyone is gearing up for 2014 and making resolutions that don't always stick, I'm encouraging you to try something that may challenge and fulfill you at the same time. I want you to write a first draft on what an "Ideal Day" looks like for you.

   What's Your Ideal Day? By Jason Womack
Inventive Innovations
Turn Your Ideas Into Reality

Ever have one of those "big ideas"–maybe a story or idea you need to share with the world, a gadget that makes modern life easier, or a way to make an existing product even better? The problem for most inventive people is not a shortage of ideas, but knowing what to do with the idea once you've had one.

   Inventive InnovationsTurn Your Ideas Into Reality

You are receiving a complimentary subscription to YOU Magazine as a result of your ongoing business relationship with Clayton Scott. While beneficial to a wide audience, this information is also commercial in nature and it may contain advertising materials.
© Copyright 2013. All About News, Inc.

Recent feedback we have received!

Attached are surveys that have recently been returned to us from both clients and agents. We truly appreciate the positive feedback we received from them. Not all mortgage companies offer the same level of service that we do. Experience counts! We are proud that we are able to offer great service and that their transactions were smooth and closed on time. 

Some of the common themes shared by our customers are that we are prompt, professional, easy to work with and work hard for our clients.

As you are well aware, buying a home can be very stressful, and the loan process can be daunting. Please let us help make your clients satisfied as well.