{"id":17271,"date":"2020-10-08T10:01:54","date_gmt":"2020-10-08T17:01:54","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=17271"},"modified":"2020-10-08T10:01:54","modified_gmt":"2020-10-08T17:01:54","slug":"october-2020-mortgage-rates-report-cheeseburgers-can-only-get-so-cheap","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/17271\/october-2020-mortgage-rates-report-cheeseburgers-can-only-get-so-cheap\/","title":{"rendered":"October 2020 Mortgage Rates Report: Cheeseburgers can only get so cheap"},"content":{"rendered":"

Why, if the Federal Reserve Bank is keeping rates at nearly zero<\/a>, are mortgage rates rising from their August lows<\/a>?<\/p>\n

Try to imagine that mortgages are cheeseburgers and it starts to make sense.\u00a0 Imagine that the mortgage industry is a lot like the fast food\/casual dining industry and it makes even more sense.\u00a0 In my last post here<\/a>, I tried to give you some background on securitized mortgage lending (aka as ‘nearly every dammed loan being funded today<\/em>‘) but just think of mortgages like cheeseburgers.<\/p>\n

\"\"If you want a cheeseburger, you have lots of choices:\u00a0 Big restaurant chains (like In N Out<\/em>) sell cheeseburgers, as do big franchised networks (like McDonalds and Burger King<\/em>) and tens of thousands independent “burger joints” in every burg across our fruited plain.<\/p>\n

Now, imagine that there was a “Federal Meat Provider” which set the wholesale price of meat to make cheeseburgers.\u00a0 A health crisis hit so the Federal Meat Provider dropped that price of meat to a stupendously low figure so everyone could eat.\u00a0 Subsequently, the chains, franchisees, and independent operators dropped the retail price of a cheeseburger to an historically low price.\u00a0 Predictably, people were lined up at every burger restaurant in the country, waiting 5 hours to get that cheap burger.\u00a0 What would you do if you owned a restaurant?<\/p>\n

Hire more people so you could sell more cheap burgers and (hopefully<\/em>) retire when the Federal Meat Provider raised the price of meat again, right?<\/p>\n

Well, it’s not that simple.\u00a0 There are new rules about selling cheeseburgers and those new employees have to be trained.\u00a0 Moreover, while the Federal Meat Provider is trying to keep cheeseburger costs low to help people during the health crisis, the various State Employment Agencies won’t let the burger restaurant owners hire just temporary \/ part-time employees without added costs and regulations.\u00a0 Add in that the local School Board wants to levy higher taxes on burger restaurant owners.\u00a0 On top of those problems, nobody really<\/strong><\/em> knows when the Federal Meat Provider will raise the wholesale cost of meat so it’s hard to predict demand beyond a 3-6 month time frame.\u00a0 At a certain Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Why, if the Federal Reserve Bank is keeping rates at nearly zero, are mortgage rates rising from their August lows? Try to imagine that mortgages are cheeseburgers and it starts to make sense.\u00a0 Imagine that the mortgage industry is a lot like the fast food\/casual dining industry and it makes even more sense.\u00a0 In my […]<\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[26],"tags":[],"class_list":{"0":"post-17271","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"hentry","6":"category-lending","8":"no-featured-image"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":17280,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/17280\/overnight-news-the-riotscore-of-chiefs-of-police-when-are-you-safe-when-should-you-flee\/","url_meta":{"origin":17271,"position":0},"title":"Overnight News: The RiotScore\u2122 of Chiefs of Police: When are you safe? When\u00a0should you flee?","author":"Greg Swann","date":"October 9, 2020","format":false,"excerpt":"There is no rioting! More importantly, there is no denial of the rioting that is not happening, anyway! How can you know that's all true? Because there are no police chiefs quitting in disgust all over the country, that's how! So there! Urf... Meanwhile: Yesterday on BloodhoundBlog: Brian Brady: October\u2026","rel":"","context":"In "Group Therapy"","block_context":{"text":"Group Therapy","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/group-therapy\/"},"img":{"alt_text":"Ya think it's easy?","src":"https:\/\/i0.wp.com\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-content\/uploads\/2020\/08\/BHBNewTopImage-300x225.jpg?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":14949,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/14949\/reforming-fanniemae-and-freddiemac-with-marx-rotarian-socialist-rent-seekers-of-the-world-unite-you-have-nothing-to-lose-but-your-brains\/","url_meta":{"origin":17271,"position":1},"title":"Reforming FannieMae and FreddieMac with Marx: Rotarian Socialist rent-seekers of the world unite! You have nothing to lose but your brains!","author":"Greg Swann","date":"August 17, 2011","format":false,"excerpt":"Totally cool. An actual newspaper article about America's favorite welfare program, government subsidized mortgages -- and in The Boston Globe, no less:Amid all the clamor about entitlement reform during the struggle to raise the debt ceiling, one enormous cost - and potential source of future savings - largely escaped scrutiny:\u2026","rel":"","context":"In "Flourishing"","block_context":{"text":"Flourishing","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/flourishing\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":5993,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/5993\/can-we-stop-falling-house-values-an-op-ed-piece-by-the-nahb\/","url_meta":{"origin":17271,"position":2},"title":"Can We Stop Falling House Values? An Op Ed piece by the NAHB","author":"Tom Vanderwell","date":"December 9, 2008","format":false,"excerpt":"This is excerpts from an op ed piece written by Steve Hodgkins.\u00a0\u00a0 I\u2019ll throw some comments in to explain\/clarify what he\u2019s saying and why I don\u2019t agree with a large portion of it. The decline in single-family home values is the predominate reason for the current economic collapse\u2026\u2026 Tom here\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":12901,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/12901\/that-giant-slurping-sound-is-the-mortgage-market-drying-up\/","url_meta":{"origin":17271,"position":3},"title":"That Giant Slurping Sound is the Mortgage Market Drying Up","author":"Brian Brady","date":"August 10, 2010","format":false,"excerpt":"Ken Montville asked the nagging question about the future of the mortgage market: Unfortunately, even Congress \u2014 that bastion of liberalism and home of the bailout \u2014 is tiring of pouring good money after bad into the two mortgage giants that have been sucking up all the mortgages \u2014 good\u2026","rel":"","context":"In "Investment"","block_context":{"text":"Investment","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/investment\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":15187,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/15187\/who-has-cutting-edge-marketing-for-mortgage-origination\/","url_meta":{"origin":17271,"position":4},"title":"Who has “Cutting Edge Marketing” for Mortgage Origination?","author":"Brian Brady","date":"October 6, 2011","format":false,"excerpt":"The mortgage business is pretty cut-and-dry today.\u00a0 Historically low interest rates, a whole lot less people in the industry, and five screwed-up banks are making it easy for originators to pick the \"low-hanging fruit\" today.\u00a0 I'm not so naive to think that the Garden of Eden will be as lush\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":6458,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/6458\/mortgages-under-management\/","url_meta":{"origin":17271,"position":5},"title":"Mortgages Under Management","author":"Brian Brady","date":"January 5, 2009","format":false,"excerpt":"\"Managing loans\" is the tail that wags the dog today.\u00a0 When I was a rookie stockbroker, the good folks at Mother Merrill taught us to \"gather assets\".\u00a0 Essentially, the firm encouraged us to pitch clients to have their assets transferred to a Merrill Lynch account.\u00a0 The strategy was that assets\u2026","rel":"","context":"In "Interview"","block_context":{"text":"Interview","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/interview\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/17271","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/comments?post=17271"}],"version-history":[{"count":2,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/17271\/revisions"}],"predecessor-version":[{"id":17276,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/17271\/revisions\/17276"}],"wp:attachment":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/media?parent=17271"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/categories?post=17271"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/tags?post=17271"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}