Stock Market: The Thread

[Brandon]

1 hour ago, Catwhoshatinthehat said:

Yesterday's drop was driven by the positive jobs report.  Between that and the fed meeting on Tuesday and Wednesday where they highlighted concerns regarding inflation investors are anticipating another rate hike at the meeting in March. 

god I hope not. since November rates have just been atrocious. I literally walk in losing .10-.25bps daily and have had multiple .50bps days in that time frame. the 10 year bond is picking up like crazy prompting the crazy rise in rates. here is a very, very goos credit union rate sheet (these are generally where they are buying rates and don't include margin or qualifying sources)

the days of ~3% are way behind us.

 

[Catwhoshatinthehat]

We got pre-qualified about 10 days ago at a quoted rate of 4.375%.  Then by the end of that week I read an article that said rates crept up to the highest they'd been in almost a year.  The days of low rates couldn't last forever, the fed raising rates is another sign the economy is picking up and it's something they need to do.  The rate on our current place is 3.625% which has completely spoiled us.  There's so little inventory in our area and price range which means the likelihood of us being able to swing a deal contingent on us selling our current place is pretty much 0 because we're competing with buyers who have their down payment in hand.  Rising rates obviously aren't appealing to me but if more listings were to come on the market and we could pull a contingent dealt I'm fine with paying something in the 4.5-5% range which is still pretty low historically.

[Brandon]

that's the kicker too. most of these people I deal with think they can fuck around or take their time even though I stress the market conditions. when they decide to move forward the rates are a quarter or half higher and they try to get pissed at everyone but themselves for their delay and rate hike. but like you said, it's still low historically. I remember when good rates were in the 6-8% range and many older folks talk about what it was like in the 80's, etc.

I'm cool with the increase over time as it's good to battle inflation, but the rapid spike in a couple months is literally a kick to the dick and margins are already tight to where most of the time I can't swing some lender credit if the rates bounce up after the opening bell the next day. makes me feel bad for the customers, but in reality, it is what it is. tough times.

[Catwhoshatinthehat]

On our current place once we had our offer accepted I locked in the rate.  I think it actually dropped slightly after that but I was comfortable with where it was at and didn't want to run the risk of rates rising.  Any raise likely wouldn't be a huge impact to the bottom line but I figured why chance it.  Just stopped off at an open house in our complex and the agent said those people are trying to do the same thing we want to do - sell their place contingent on them finding a place while getting into a house in the same area. 

Meeting with our agent tomorrow to talk about listing our place in the not too distant future but unless more comes on the market we will hold off.  Read an article about a week ago that talked about how few listings there are locally and it said the last time there were this few was when we bought back in 2012.  Back then anything worth a damn got multiple offers in a matter of no time which is great if you're a seller getting out of the area or not trying to buy something else but it wasn't fun as a buyer.  I figure as rates rise at some point price appreciation will slowly or maybe even reverse course a bit but when it comes to popular markets the rules don't always seem to apply.

[Brandon]

I would have done the same with this climate. even if it bounces down an eighth, it's not much in the grand scheme of things to float and be wrong....plus, I'm of the ilk that numbers also work as an inverse. say you add $20 or whatever the eighth is, you theoretically have the same rate. some people want to shoot down the rate sheet, but I tell them to take the par rate, keep the money in their pocket that they would throw at the rate and just apply it to the principal every month to accomplish the same thing without paying for it.

I doubt you'll have issue selling. a lot of my purchase friends are slammed right now as people speculating have seen the rates go ape shit and are finally jumping on buying.

curious question you may or may not know (but I could ask others), if you don't have a contingency on your current home, do they hit you for that payment plus the new one on your DTI (debt-to-income ratio)?

[Catwhoshatinthehat]

16 hours ago, Brandon said:

curious question you may or may not know (but I could ask others), if you don't have a contingency on your current home, do they hit you for that payment plus the new one on your DTI (debt-to-income ratio)?

No idea but let me know when you find out.

[Brandon]

12 minutes ago, Catwhoshatinthehat said:

No idea but let me know when you find out.

I'll get something here in a bit, this FB group I'm in is pretty much 100% (I'm one of the few predominate refi guys) purchase and we all jump at the chance to help with scenarios and guidelines.

DTI is just a guideline and we don't care as long as it stays under the guideline. Whether they are a multi-millionaire with no debt or barely qualify with a 50.4% backend, it's all the same. My thought process is you wouldn't have been pre-approved if that was an issue.

And as I was typing this I got a response. They will hit you with both mortgage payments at the time of purchase. I'm guessing income is good and debts are low for the pre-approval. Your frontend will be the new housing expense and your backend will be all tradelines (credit cards, autos, student loans, etc.). On a conventional loan as long as you are at 49.99% or less you will be fine. FHA generally goes up to 56.99%, but the previous home can't be FHA. Just take your overall debt (include the old home and new home) and divide it by your gross income if you wanted to do it on your own or if anyone was reading this and curious to what their DTI would be going into a new purchase or refi....although, refi DTI's are a little more flexible.

[Brandon]

You also have this option if DTI does become an issue. I knew there was a loophole, just didn't know if it was changed and it hasn't. Per a network partner:

If DTI becomes an issue, have them list their home with contingencies and a long escrow instead. Sellers definitely have that kind of pull in this market. If you’re pending sale and cleared finance contingencies, even if it won’t close prior to you closing on the purchase you can exclude it from DTI per Fannie.

[fan_since79]

Looks like another bad day.

So much for rushing towards 27,000. Fear is back.

 

[Angel Oracle]

Guess the drop was long overdue.   Just hope it doesn't induce panic.

[Jason]

2 hours ago, Angel Oracle said:

Guess the drop was long overdue.   Just hope it doesn't induce panic.

Down 3% today. 

[Catwhoshatinthehat]

Right now the DOW is on pace for it's biggest point drop (not percentage) ever.  Was down over 1,500 points at one point but it's recovered a bit.  S&P isn't getting hit as bad percentage wise but I'll be interested to see where end for the day.  

[Brandon]

holy fuck sticks!!!

[Catwhoshatinthehat]

Shortly before that it was about 1,000 points down, shot up to 1,500 down then to about 900 down.  Some computer systems are kicking in and sell orders at a certain level, quant trading and who knows what else are triggering huge swings.

[Jason]

3 minutes ago, Brandon said:

holy fuck sticks!!!

I'd imagine many of today's traders have never experienced inflation fears like this

[Amazing Larry]

7 minutes ago, Jason said:

I'd imagine many of today's traders have never experienced inflation fears like this

Seriously. The kids have had it so good for so long. 

[fan_since79]

I've never seen volatility like this. Who knows, we might be down only a few hundred by the end of the day.

[Brandon]

14 minutes ago, Catwhoshatinthehat said:

Shortly before that it was about 1,000 points down, shot up to 1,500 down then to about 900 down.  Some computer systems are kicking in and sell orders at a certain level, quant trading and who knows what else are triggering huge swings.

yeah, i checked when i was told it broke the 1k barrier. then literally as i pull it up some dude yells across the room, "now "1500".

just hit refresh twice and it went to 769 and now at 833.

must be wild to be a trader.

[Catwhoshatinthehat]

What's funny is when it went down about 1,000 points some system limits kicked in saying to sell so it drops to 1,500 down then some other system limits kicked in saying to buy so it bounces back.  Despite me seeing it down 1,500 points and having a momentary flashback to 2008/2009 at it's worst today that still wouldn't have put in the top 300 % daily DOW declines.  

[Brandon]

i wish i was good at photoshop and creating memes. could probably do something with this.

[Tank]

that looks like one of my tee shots.

[Angel Oracle]

What happened just after noon PST to drive it down 600 pts in just 15 min?   The auto sell kickers, as noted earlier?

[Tank]

5 minutes ago, Angel Oracle said:

What happened just after noon PST to drive it down 600 pts in just 15 min?   The auto sell kickers, as noted earlier?

no. it was the realization that tom brady is still part human and that it was possible for the pats to lose a super bowl.

[Amazing Larry]

44 minutes ago, Angel Oracle said:

What happened just after noon PST to drive it down 600 pts in just 15 min?   The auto sell kickers, as noted earlier?

Some algo got triggered resulting in another algo getting triggered resulting in another algo getting triggered etc. etc...

[fan_since79]

This is Jerome Powell's first day as Fed chairman.