HSH in the news - 2022

April 9, 2022: "Mortgage Rates Break 5% as the Federal Reserve Tightens Monetary Policy", a Yahoo Finance market update by Kathleen Howley included some insight from HSH.com vice president Keith Gumbinger:

Interest rates for home loans are surging as yields for the bonds containing U.S. mortgages increase. The investors who influence mortgage rates are demanding higher returns for bonds amid the worst inflation in four decades, said Keith Gumbinger, vice president of HSH.com, a mortgage research firm.
"The combination of rising inflation and tightening monetary policy is putting tremendous upward pressure on mortgage rates," Gumbinger said. "As an investor in a fixed asset, you want to see some return for your money, something to account for higher inflation."
Part of the problem is the waning efficacy of China's vaccines, which have proven to be not as effective as the mRNA Covid-19 vaccines available in the U.S., especially against the Omicron variant.
"Covid-19 is the wildcard when it comes to inflation," Gumbinger said. "We don’t know what kinds of global disruptions in the supply chain we are going to see this year."

March 18, 2022: "6 Strategies To Help Your Child Buy A Home", a Bottom Line financial planning and strategy article prominently featured advice from Keith Gumbinger, HSH.com's Vice President.

March 16, 2022: "What a Federal Reserve Rate Increase Means for You", a New York Times consumer advisory by Tara Siegel Bernard featured some context from HSH.com VP Keith Gumbinger:

Mortgage rates don’t move in lock step with the federal funds rate, but instead track the yield on 10-year Treasury bonds, which is influenced by a variety of factors - including how investors expect the Fed to react to inflation.
Mortgage rates have already been ticking higher as a result of inflation, even though they remain historically low: Rates on 30-year fixed-rate mortgages averaged 3.85 percent with 0.8 points as of March 10, according to Freddie Mac, up from 3.76 last week and 3.05 a year ago. (A point is a one-time fee, equal to 1 percent of the mortgage amount, paid to the lender to buy down the mortgage rate.)
"The pain to the consumer from accumulated hikes probably doesn’t start to bite until several rate increases are in place," said Keith Gumbinger, vice president at HSH.com, which tracks the mortgage market. "But at the same time, rates could rise considerably from present levels and still be considered low by historical standards."
Mr. Gumbinger said he expected the 30-year fixed rate mortgage to "crest over the 4 percent mark this week," pressured upward by inflation, which is pushing long-term Treasury rates higher (and pulling mortgage rates along).

March 4, 2022: "Buying Short-Term Rentals", a Real Estate Today podcast by the National Association of Realtors hosted by Stephen Gasque included HSH.com VP Keith Gumbinger as a guest discussing the financing angles of short-term and vacation rental properties.

February 19, 2022: "Mortgage lock rates surge in January, as borrowers beat rising rates", a , a Yahoo Finance look at how mortgage borrower reactions to rising rates by Gabriella Cruz-Martinez featured commentary from Keith Gumbinger, HSH.com's vice president:

Cash-out locks on the rise
As home values surged last year, Americans capitalized on tapping the record amount of home equity they gained. Cash-out refinancings — the amount homeowners can borrow while retaining at least 20% of their property value — made up 54% of all refinances in the third quarter, according to Black Knight’s latest figures.
"When we talk about cash-out refinancing, interest rate sensitivity still exists but it isn’t quite as strong as it would be for a rate-and-term refinance," Keith Gumbinger, vice president of HSH.com, told Yahoo Money. "A borrower looking to do a cash-out often may be replacing a much higher interest rate debt with a lower interest rate debt."
Cash-out activity is expected to continue - especially as some homeowners use the money to pay off credit card debt because rates on that debt will rise in lockstep with Federal Reserve interest rate hikes.
"Your credit card rates might be at 13% or 14% [so] a 3.5% interest rate is just fine because your cash-out refi is going to help solve your problem," Gumbinger said, "which is to pay off your credit cards. They will be paid off at a lower interest rate."
"There is great interest rate sensitivity when we talk about refinancing. That’s particularly true for borrowers looking for a rate-and-term refinance, generally known as a traditional refinance," Gumbinger said. "When you’re trying to get a lower payment, obviously you won’t get a lower payment if your interest rate isn’t lower."

February 4, 2022: "Mortgages 2022", a Real Estate Today podcast from the National Association of Realtors hosted by Stephen Gasque included HSH.com VP Keith Gumbinger as a featured guest, discussing all aspects of the mortgage borrowing climate as the winter market turns to spring.

February 4, 2022: "Mortgage rates: Homeowners rush to refinance during rate pause", a Yahoo Finance look at mortgage borrowing conditions by Gabriella Cruz-Martinez included some commentary from Keith Gumbinger, HSH.com's vice president:

"The couple of weeks' rise in mortgage rates can be a call to action for some potential borrowers. Headline news about rising mortgage rates and increasing expectations for the Fed to start tightening policy soon are a signal to get a deal in place," Keith Gumbinger, vice president of HSH.com, told Yahoo Money. "Call it a preemptive strike of getting a refinance in place before mortgage rates run any higher."
"While there was a jump in refinance activity per the MBA, it's important to remember that this was a jump from a fairly low level of activity the week before," said Gumbinger. "In the prior week, the MBA's refinance index value was at its lowest value in about two years and the bump only returned refinance activity back to where it was in the first week of 2022."

February 2, 2022: How to Draw on Equity to Expand Your Housing", a UExpress look at ways to improve your home by using your home equity from syndicated columnist Ellen James Martin included some tips and hints from Keith Gumbinger, HSH.com's VP:

"Nobody is cheering for higher rates. But they may be a necessary evil to tame an out-of-control economy," says Keith Gumbinger, a vice president at HSH.com, which tracks mortgage markets throughout the United States.
"Don’t let your fears about how to proceed keep you from moving forward with your refinance plans. Especially now, when rates are forecast to go higher, it’s a mistake to hem and haw in hopes they will drop again before you apply," Gumbinger says.

January 27, 2022: "Mortgage rates settle after four weeks of increases", a Yahoo Finance market update by Ronda Lee featured a couple of quotes from HSH.com vice president Keith Gumbinger:

Mortgage rates were little changed this week after four weeks of marching higher. But the recent increases, which likely will resume, have already dampened refinance activity and pressured homebuyers to make a move.
The rate on the 30-year fixed mortgage - the most common home loan for buyers - edged down to 3.55% from 3.56% the previous week, according to Freddie Mac. The rate is still among the highest since March 2020 and is over a half-point higher than a month ago.
Even with the slight decrease, "mortgage shoppers should not get used to it, as rates are pushing higher again this morning after Fed Chair Powell's press conference yesterday," Keith Gumbinger, vice president of HSH.com, told Yahoo Money. "Interest rates are firming again and until inflation starts to show signs of cooling, odds favor higher than lower mortgage rates."

January 25, 2022: "Conforming Mortgage Loan Limits Rising", a Kiplinger review of changes in mortgage borrowing conditions by Lisa Gerstner featured some context from Keith Gumbinger, HSH.com's vice president:

For 2022, the standard conforming limit for single-unit properties is $647,200, up nearly $100,000 from the 2021 cap.
Conforming loans are the most common type of mortgage, and they often have lower interest rates than other loans. To borrow more than the conforming limit, you must qualify for a jumbo loan, which usually has a higher rate and stricter underwriting requirements. You may be able to get a conforming loan with a credit score as low as 620, and a 740 or higher score can get you the best rates.
Jumbos may not be available to borrowers with credit scores below the mid-to-upper 600s, and you’ll need a credit score of at least 760 for the best rates, says Keith Gumbinger, vice president of mortgage research site HSH.com. A conforming loan may have a loan-to-value ratio (the amount borrowed expressed as a percentage of the property’s value) of up to 95%, while a jumbo loan’s LTV usually can’t surpass 80%, says Gumbinger.

January 20, 2022: "Mortgage rates surge for 4th week before Fed hikes", a Orange County Register/Bloomberg snapshot of mortgage rates by Jo Constantz included a quote from HSH.com VP Keith Gumbinger:

Still, borrowing costs may level off in the coming weeks, according to Keith Gumbinger, vice president at mortgage-information company HSH.com.
"We’re starting to see signs that we might be topping out on rates," Gumbinger said in an interview. "The Federal Reserve has made a bit of a shift, but it’s not clear if the shift has completed yet."
Mortgage rates have been expected to rise this year after the Federal Reserve announced last month that it would begin dialing back its monthly bond purchases - which are intended to lower long-term rates - to slow accelerating inflation. But even with the expected three or four rate increases in 2022, the Fed’s key rate would still be historically low at around 1%.

January 20, 2022: "Rapid rise in mortgage rates startles homebuyers; blame inflation fears", a Detroit Free Press look at changing market conditions by Susan Tompor review of quickly changing mortgage market conditions included a discussion with HSH.com vice president Keith Gumbinger:

All the big unknowns surrounding the rapid jump in inflation - including how high consumer prices will go and how quickly the Fed will raise interest rates - have put the mortgage market on high alert in early 2022.
"Rates have gone up rather quickly and there's still a little upward movement going on," said Keith Gumbinger, vice president at the mortgage lending information site HSH.com.
The speed is somewhat startling, but so, too, was the uptick in inflation last year.
Gumbinger blames the rapid mortgage rate hikes on the lack of clarity, as well as the lack of experience among today's bond market investors.
"Many investors in today's markets really have not lived through a spate of inflation like this," Gumbinger said.
How high could mortgage rates go?
As much as people may be shocked by the recent mortgage rate hikes, rates still aren't anywhere close to historically high levels or even what we've seen just a few years ago.
The average 30-year rate was 4% nearly three years ago back in May 2019, according to Gumbinger at HSH.com.
But the last time borrowers saw 30-year rates routinely in the 5% range was 2011.
If you go back to January 1982, when inflation was hot, the average 30-year fixed rate was more than 18%, he said.
Amazingly, he said, the low point during the pandemic was back in January 2021 when the average 30-year rate hit 2.65%.
"The lowest mortgage rates come in the worst economic climates," Gumbinger said.

January 19, 2022: "Rising Mortgage Rates Are No Reason to Panic Buy", a Washington Post consumer advisory from Bloomberg.com's Alexis Leondis featured a bit of perspective from Keith Gumbinger, HSH.com's VP:

While there was a quick spike at the beginning of this year, economists are still predicting that rates will end 2022 at about 4%. They’re also anticipating that home-price increases will slow, which could help to soften the blow of higher rates. "Mortgage rates have just gone from fantastic to a little less fantastic," says Keith Gumbinger, vice president of mortgage loan website HSH.com.

January 19, 2022: "Mortgage rates: Homeowners face a shrinking window to refinance", a Yahoo Finance consumer update by Gabriella Cruz-Martinez featured seom expertise from HSH.com vice president Keith Gumbinger:

Other factors outside the current rate environment also help determine your refinance rate, including your home’s location, mortgage type, home equity, and credit score.
"In terms of getting the lowest interest rate, you’ll need to have the highest credit score. You’ll also need to have a pretty deep equity position," said Keith Gumbinger, vice president of mortgage-information company HSH.com. "Credit scores that are at a FICO 740 or above will generally bring the lowest interest rate to borrowers, and if you have a lower credit score, that may mean your interest rate or fees for the loan may be higher."

January 13, 2022: "Mortgage rates: Pandemic era ‘deals’ all but gone", a Orange County Register market update included a quote from HSH.com's vice president Keith Gumbinger:

There are some indications that inflation may be easing, with an index measuring prices paid to U.S. producers coming in lower than expected.
"If inflation cools off, interest rates will level," said Keith Gumbinger, vice president at mortgage-information company HSH.com.

January 13, 2022: "Mortgage Rates in U.S. Soar to the Highest Since March 2020", a Bloomberg market conditions update by Jo Constantz included a quip from Keith Gumbinger, HSH.com's VP:

There are some indications that inflation may be easing, with an index measuring prices paid to U.S. producers coming in lower than expected.
"If inflation cools off, interest rates will level," said Keith Gumbinger, vice president at mortgage-information company HSH.com.

January 3, 2022: "What homebuyers today have going for them, according to a mortgage expert", a Grow.Acorns/CNBC analysis of housing and mortgage market conditions by Kiersten Schmidt included a range of observations from HSH.com vp Keith Gumbinger:

In the early 1980s, rates around 15% on a 30-year, fixed-rate mortgage were common. They have been on a downward trend ever since.
"Five percent interest rates used to be something that homebuyers cheered on when they came around, then it was fours and now it’s threes," says Keith Gumbinger, vice president at mortgage research site HSH.com. "We really are living in favorable times. Homebuyers today have not experienced high interest rates in their adult lifetimes." A lower down payment could mean a higher interest rate. Lenders consider these loans to be riskier, and they will often charge higher interest rates to compensate. It’s also important to consider incomes when looking at historical home prices, says Gumbinger. While home prices have doubled since 1981, median household income has risen 27% since 1984, the earliest year data is available. First-time homebuyers today "have really only known a fixed-rate environment," says Gumbinger. "They’ve also only known a very favorable interest rate environment."

Back to HSH.com in the News — 2021

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