First great news of the day (other than it being Friday): The FHA 0.25 special has been extended through the month of May!!!! Nations Direct has always been the best FHA lender in wholesale, let’s keep funding more FHA loans!
Next great news of the day, and it’s rather mind blowing. After the success of our Premier Conventional purchase program we have decided to expand the program to include refinances, both rate and term and cash out. What makes this program truly unique is that there is an LTV cap of only 95%. A lot of the competition only offers “Elite” pricing up to 80% LTV. But think of all the people who bought last year at higher rates. The home price appreciation has been slow since last year, and their rate should be higher than the current market. There is a ton of opportunity on this product!!!
Stocks erased losses after positive U.S. GDP news was released. The data showed economic growth accelerated more than forecasted in the first quarter, 3.2%, while the dollar held onto a slight gain. Despite the positive data, there are still questions around how long the world’s largest economy will continue to expand and when the impact of President Trump’s tax revamp will begin to fade.
Bond prices are up slightly, and the 10-year treasury is yielding 2.51%. First quarter GDP over 3% shows that the economy is still growing at a solid pace and makes it clear that the Fed won’t have any reason to cut rates this year. With a strong economy and low inflation, rate cuts are considered premature and irrelevant.
U.S first quarter GDP expanded at a 3.2% annualized rated, topping all forecasts. Consumer spending, the biggest part of the economy, rose slightly above forecasts, while business investment cooled. The growth pickup largely reflected a decline in imports, greater state and local government spending, and rising inventories. Net exports added 1.03% to growth while inventories added 0.65%. Again, there are doubts surrounding the U.S economy and how long it will last. We are likely to see the factors that made the first quarter GDP look great come back and make the second quarter GDP look weaker, namely an unaddressed inventory hangover.