Rates are Great. So is Setting Expectations!

August 24, 2020

We pride ourselves on offering some of the best service and products or our clients in the industry. But those are two parts of a three-part package. While rumors swirl about the FHFA (which oversees Freddie Mac and Fannie Mae) reconsidering the .50 price hit for refinances, or at least delaying it, Orion continues to offer great rates as well. As we head into the tail end of August, our AEs continue to be asked why mortgage rates aren’t even lower than where they are now.

We remind our clients that the Federal Reserve doesn’t set rates, and although have vowed to keep Fed Funds near 0 percent for the foreseeable future, that doesn’t necessarily help our brokers help their borrowers. For many brokers and borrowers, this is hard to understand, but it is yet another example of media misinformation that Orion’s AEs work to correct, and help your borrowers understand.

Like it or not, the virus continues to dominate the news, and financial markets, and will probably for the rest of 2020 and into 2021. And the slowing down of the economy continues to keep rates low. In other words, the same economic conditions impact short term rates, and the Fed’s actions, and long-term rates, like mortgage rates.

With the 10-year Treasury, which is usually a harbinger of mortgage rates, closing Friday at 0.63%, why aren’t mortgage rates much lower than they are? Investors are concerned about early pay offs. There are capacity issues. Orion’s clients know that we are working overtime to process and fund your client’s loan. We have added technology and processes to help streamline loans, and hiring personnel every week through the summer. But what is the point of Orion, or any company, offering a lower-than-market rate if we can’t close your loan for 90 days? There is no sense in promising to make a loan to a client in a certain period if we can’t meet it. And we pride ourselves on beating your expectations.

If your client wants to refinance, start with a conversation with an Orion AE and work on a loan application and the needed documentation. This way, the day when rates fall to your client’s objective, we can lock your rate and at that time all that is needed is the appraisal. Our AE is here to help if you have questions!

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