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After Congress affirmed Joe Biden’s presidential victory and Democrats flipped the Senate this week, the 10-year Treasury yield climbed 4 basis points to 1.08% on Thursday. This is up from 1.04% on Wednesday—the first time since March 19 that 10-year yields broke 1%.
With Democrats at the helm of both the White House and Congress, investors are anticipating additional fiscal stimulus, putting upward pressure on yields (which increase as bond prices decrease). Bonds are considered safe-haven assets, but with renewed optimism in the economy, investors are turning to U.S. stock futures.
Mortgage rates usually run in lockstep with yields, so when yields rise mortgage rates often follow.
“Now that the Democrats have 51 votes, we’ll have a stimulus, which is why you’re seeing the sudden rise in yields,” says Logan Mohtashami, a housing data analyst at HousingWire.
Mortgage Rates Likely to Rise
Assuming the coronavirus vaccine eventually helps control the spread of Covid-19 and the economy gains strength, borrowers should expect mortgage rates to rise. The Mortgage Bankers Association predicts the 10-year Treasury yield will jump 1.4% by the fourth quarter of 2021, with average rates on the 30-year fixed rate mortgage hitting 3.2% by the third quarter of this year and remaining there until 2022.
Mohtashami says higher rates are good in an overheated market such as this one, as they will help to stabilize home prices. Because “low rates are a big driver of homebuying,” making mortgages a little more expensive will help cool rising prices and give first-time homebuyers more breathing room.
Homebuyers who want to lock in today’s sub-3% rates should shop for a lender now. You can lock in your rate, which will help protect you in case interest rates increase while you shop for a house. Winter is usually a slower time in the real estate market, so the chances of finding houses with lower prices are better now than if you wait until spring when the market usually picks up the pace.
Homeowners Shouldn’t Put Off Refinancing
Rising rates are bad news for homeowners hoping to refinance their mortgage in 2021. While there’s no guarantee rates will rise, the signs point to upward movement.
Currently, however, rates are hovering near record lows, around 2.65%, according to Freddie Mac. So waiting for rates to drop lower might be a sour bet. If you’re not sure whether refinancing makes sense, use a refinance calculator to get an idea of how much you can potentially save based on current interest rates.
Refinancing comes with closing costs, which can run between 2% and over 6% of your loan amount, so it’s important to factor this in when you’re crunching numbers. The longer you plan to stay in the home, the more time you have to make up those closing costs and start seeing the savings.
If you’re ready to refinance, start shopping around. Find out which lenders offer the lowest rates and closing costs so that you can maximize your savings. Some lenders offer customer discounts, as well as discounts for members of the military or certain professions, like teachers. Every little bit helps, so ask your lender about discount programs.
Check Your Credit Before You Apply
And finally, to get the lowest interest rate you must have a strong credit score and sufficient income. Aim for a score in the high 700’s or 800’s, as this will ensure that you qualify for the most competitive rates.
If your score is average or below average, talk to a credit counselor about how you can improve it. For some consumers, it might be as simple as making sure you pay your bills on time or pay off a credit card, while for others the credit repair process can take longer. Either way, having good credit can help you both get a cheap mortgage or even land certain jobs.
Also, consider that you might have errors on your credit report that can drag your score down. You can discover errors as well as negative events by getting copies of your credit report from the three credit bureaus: TransUnion, Experian and Equifax.
Lashonda Nesmith Jackson, Bryan Braddock to speak at hip hop rally Saturday | Local News
FLORENCE, S.C. — Two candidates running for Florence City Council will speak at an event scheduled for Saturday afternoon.
Lashonda Nesmith Jackson, one of five candidates running for the Democratic nomination in the District 1 special election, and Bryan Braddock, one of four Republicans running in the District 3 special election, will speak at the Stop the Violence Hip Hop Rally.
The rally is scheduled for 1 to 3 p.m. Saturday at Northwest Community Park, located at 801 Clement St in Florence. It will also feature music, a clinic on expungements and pardons, a credit repair service and free food.
California Announces Plans for Reviewing Consumer Complaints
California’s Consumer Financial Protection Law is in effect and the Department of Financial Protection and Innovation (DFPI) announced plans for reviewing consumer complaints in its monthly bulletin for January.
California Gov. Gavin Newsom approved the California Consumer Financial Protection Law (AB 1864), which creates a state consumer protection agency before the end of the state’s 2020 legislative session. The law also expands the state’s power to target unfair, deceptive and abusive acts and practices by financial service providers, ACA International previously reported.
Effective immediately, according to the DFPI bulletin, it will “review and investigate consumer complaints against previously unregulated financial products and services, including debt collectors, credit repair and consumer credit reporting agencies, debt relief companies, rent to own contractors, private school financing, and more.”
Under the consumer financial protection law, the DFPI will also:
- Significantly expand the state’s consumer protection capacity by adding dozens of investigators and attorneys to supervise financial institutions.
- Create a team to monitor markets to proactively identify emerging risks to consumers.
- Create a team dedicated to consumer education and outreach, listening and responding to consumers in specific communities, including veterans, immigrants and older Californians.
- Create a new Office of Financial Technology and Innovation, which will cultivate financial technology to serve consumers.
This spring, the DFPI will launch a statewide campaign to educate California consumers on how the department can support and protect consumers, according to its bulletin.
Licensing Requirements in the Works
Under a law passed last year, California is now one of 35 states to require a license for debt collection. Agencies have one year to apply.
The Debt Collection Licensing Act (SB 908), from California State Sen. Bob Wieckowski, D-Fremont, was signed into law by Newsom in September 2020.
It was welcome news for the accounts receivable management (ARM) industry and ACA that the governor approved both these measures, allowing for a separate licensing process outside of the DFPI.
With the governor’s signature on the licensing bill, the commissioner of the Department of Business oversight shall take all actions necessary to prepare to be able to fully enforce the licensing and regulatory provisions of this division, including, but not limited to, adoption of all necessary regulations by Jan. 1, 2022.
The California Association of Collectors (CAC) advocated to ensure workable options for consumers and the ARM industry in the licensing bill. And the Collectors Insurance Agency (CIA) licensing team had a seat at the table to negotiate the best licensing legislation possible for the ARM industry.
While a license will not be required until 2022, the state has indicated the application and its checklist should be submitted as soon as they are live in 2021. The law permits the state to use the electronic Nationwide Multistate Licensing System (NMLS) for the licensing process. There will also be a bonding requirement as part of the licensing process.
License applications will be due by Dec. 31, 2021, and the DFPI expects to begin the licensing process in late summer or fall next year. Debt collectors that apply for a license before the deadline next year would be allowed to operate pending the approval or denial of the application.
Under the law, the DFPI will also appoint a seven-member Debt Collection Advisory committee.
Even though the application is not available yet, ACA members and ARM industry professionals can contact the CIA licensing team to be added to the Licensing Service List. When the application and list of requirements is available, the team will provide more information on the service.
For more information on how the ACA licensing staff can assist with your licensing application completion needs in California as well as other states, please email firstname.lastname@example.org or call (952) 926-6547.
Industry Disruptor Curtis Ray Launches Retirement Planning and Saving Service, MPI™ UNLIMITED
GILBERT, Ariz., Jan. 14, 2021 /PRNewswire/ — Curtis Ray, retirement planning expert and creator of the patent-pending Maximum Premium Indexing (MPI™) Plan, announced today his newest company, MPI™ UNLIMITED. The company’s proprietary technology utilizes the security guarantee of permanent life insurance, the growth potential of the stock market and the power of compound interest to provide enhanced retirement income, tax-free.
“I am thrilled to announce the official launch of MPI™ UNLIMITED,” said Ray. “After years of research in the financial planning space, I realized that traditional strategies, like the 401(k) and IRA, are not providing enough income throughout retirement years. I’m looking forward to teaching hardworking people, from all walks of life, how to utilize secure compound interest to maximize their savings and achieve their dream retirement. Always Be Compounding!”
The MPI™ plan is an advanced cash-value life insurance plan specifically designed as a max-funded, increasing death benefit contract. The plan provides holistic benefits to clients which include mitigation against market risk, enhanced compound interest returns, increased retirement income, tax-free distribution and more.
Ray’s passion for retirement planning goes beyond MPI™ UNLIMITED; a best-selling author, Ray tackled the challenges of consistent underperformance in the current retirement planning industry in his 2018 book Everyone Ends Up Poor. In his most recent book, The Lost Science of Compound Interest, Ray deconstructs the phenomenon of compound interest, teaching readers to harness its power through small and simple actions.
“Learning about MPI™ and compound interest has been one of the most valuable things I’ve learned in my life. I have a master’s degree in engineering, yet I have never seen anything like this before,” said Angie Merget, Financial Engineer and MPI™ UNLIMITED client. “Taking the time to understand MPI™ is without a doubt the best thing you can do for yourself and your family.”
The purpose of MPI™ UNLIMITED is to provide services focused on the phenomenon of compounding. Within the next five years, Ray plans to expand their offerings into mortgage, credit repair, personal tax filing and other financial services to give every American the best path to financial freedom.
To learn more about MPI™ UNLIMITED and its retirement planning options, visit www.mympi.com.
About MPI™ UNLIMITED
Founded in 2020 by Curtis Ray, MPI™ UNLIMITED works to provide simplified financial education that addresses complex money topics, so that the public can understand and implement the full potential of Secure Compound Interest in their life. Ray, best-selling author and MPI™ UNLIMITED’s CEO, invented and developed the patent pending MPI™ (Maximum Premium Indexing) Secure Compound Interest Account, in order to help people maximize their retirement savings.
SOURCE MPI UNLIMITED
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