VA Termite Inspections, Fed Chair Transition, VantageScore 4.0, Rate Cut Expectations,Jobless Claims

Good morning and happy Friday. Jordan Keck here, your lender buddy, with your weekly market update. Kicking off, interest rates staying about the same as last week after we saw that nice improvement down, going from 6.75% to 6.79% week over week. Still pretty nice, seeing a lot of clients under that 7% mark. Which is great. Remember, not all clients are going to be in the same situation. Different loan types, different buydowns, different credit scores, down payments, and property types are all going to check to change your specific quote. But overall, taking a general trend for the market, big news here this week I do want to let you know about. This is a change for Oregon from the federal VA. Until just now, Oregon was one of the states that was exempt from the termite inspections required on VA loans in most other parts of the country. Unfortunately, effective now, the VA has changed that guideline to require VA termite inspection reports on all properties in Oregon using VA financing. This is something brand new. I'm actually going through my first one right now that was required. So just be aware, as you have clients with VA loans, is this something that Is it something the seller is going to be paying for? Is it something the buyer is going to do? Who is able to do them? How quickly do they return those reports? Honestly, I don't have a ton of answers on those yet, so we're finding this out in real time. But this is something I want to make sure you're aware of if you're either listing a property and somebody requests it, or if you're a buyer's agent helping somebody buy it. This is brand new and will again apply to all VA loans on all properties in the state of Oregon moving forward. Forward. Next up, as far as news for this week, Fed Chair Powell, his term is up in May, and there's already been getting a race of who is going to be his replacement. He is definitely not going to be continuing in that role. If you've been watching, a lot of criticism to him from the current administration about how his handling of inflation and COVID has been. Some of the top candidates for that spot are current Fed Governor Waller and Director of National Economic Council Kevin asset. So we'll see what happens there. And over the coming months, it's going to be more clear who is going to be up for that position and of course their views on inflation. Are they more friendly towards rate cuts? Are they more likely to wait? That's going to determine where the market goes based on who is expected to get that spot. Remember, it's not the reality that changes the market, it's the expectations. And does reality match expectations or is it different? Another big one here, the FHFA, which governs Fannie Mae and Freddie Mac for conventional loans, announced that they are immediately going to begin accepting VantageScore 4.0. Now this is in addition to the FICO scores that are standardly used. The difference on it is VantageScore incorporates alternative data sources like rent, utilities, phone bills, and it also eliminates requirement for a consumer report to have older than 6 months worth of data before generating a score. As a result of that, it's estimated that there could be up to 5 million more eligible buyers who can use a VantageScore that may not have been able to generate a FICO score. So again, this is pretty fresh here, still rolling out, so a lot of questions on that piece, but wanting to make you aware. Next up, the Federal Reserve meeting minutes from their June 18th meeting were released, giving some insight into their feelings about rate cuts And unfortunately, it looks like that it's probably going to be pushed back until at least September if there's a rate cut at all this year. Definitely didn't get it in June, not looking likely in July or for August. The meeting showed that there was some division between members, with several wanting to wait and some wanting to cut quicker. But since the meeting, we've come out with some very strong jobs reports that may end up changing their opinions and pushing that even farther out. And lastly here, initial jobless claims fell from 232,000 to 227,000 first-time filers for last week, but it was a holiday week with the 4th, so we always want to take those with a little bit of a grain of salt. The bigger issue though is continuing claims. So those who have filed for more than 1 week rose to the highest it's been since November of 2021, 1.97 million here, really close to that 2 million number. And we've just seen that number stay high above 1.8 million for a while, showing that those who have been out of work not getting returned to work very quickly here So with those, again, definitely want to watch that because it can be the initial numbers for higher unemployment numbers and concerns for the global economy. So overall, a lot of changing things happening, a lot of news. So hopefully next week I'll have some more information about the VantageScore, more information about those VA termite reports. But if anything comes up, you have questions in the meantime, let me know. Trying to get up to date as quickly as possible on things. Hopefully have a fantastic weekend. Stay cool out there as things get hot, and we'll see you next time. Take care.