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Fed expects low Rates thru 2023

Didier Malagies • September 17, 2020

Fed says expect low rates through 2023

    Politics & Money Fed says expect low rates through 2023


The central bank pledges to continue bond-purchasing program that have driven down financing costs

September 16, 2020, 6:25 pm By


The Federal Reserve left its overnight lending rate unchanged on Wednesday at the end of its last meeting before the Nov. 3 presidential election and said it expects to keep it near zero for more than a year.

In a statement released Wednesday, all 17 members of the Federal Open Market Committee said they expect to keep the central bank’s benchmark rate near zero at least through next year, and 13 estimated it would stay there through 2023.


That will be a boost for homebuilders taking out business loans, and will keep rates low for home equity loans tied to prime rates, which are benchmarked to the Fed rate.


The committee also reiterated its commitment to purchase mortgage-backed securities and Treasuries to support the flow of credit. Fed purchases have helped to drive mortgage rates to the lowest level on record by boosting competition for the bonds, which compresses yields.

“Over coming months the Federal Reserve will increase its holdings of Treasury securities and agency mortgage-backed securities at least at the current pace to sustain smooth market functioning and help foster accommodative financial conditions, thereby supporting the flow of credit to households and businesses,” the FOMC said in its statement.

In the first meeting since last month’s overhaul to its inflation policy that will allow it to average its target 2% inflation rate rather than target it, the committee provided more specifics.


“The committee will aim to achieve inflation moderately above 2% for some time so that inflation averages 2% over time and longer-term inflation expectations remain well-anchored at 2%,” the statement said. “The committee expects to maintain an accommodative stance of monetary policy until these outcomes are achieved.”


In a press conference following the release of the FOMC statement, Fed Chairman Jerome Powell said more stimulus is needed from Congress to help an economy struggling with the COVID-19 pandemic.



“My sense is that more fiscal support is likely to be needed,” Powell said. “Of course, the details of that are for Congress, not for the Fed. But I would just say there are roughly 11 million people still out of work due to the pandemic and good part of those people were working in industries that are likely to struggle. Those people may need additional support as they try to find their way through what will be a difficult time for them.”

   

  






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By Didier Malagies December 20, 2024
Older homeowners have an overwhelming preference to age in place , but these circumstances can also come with unique challenges. Feelings of isolation and loneliness rank highly among these issues, but a recent study suggests that aging in place with a pet can make a big difference. The study, highlighted in Psychology Today , also noted that having pets in later life can come with its own set of unique challenges , according to Ann Toohey, one of the authors of the study who is based at the University of Calgary. The study followed initial interviews conducted in 2015 by examining how owning a pet impacted the lives of older people aging in place in their homes. According to the study, several takeaways emerged, including that the companionship of a pet makes a difference in their owners’ lives. While the companionship provided is understandably different from what is offered by another person, it also came with other potential social benefits for the seniors who owned pets. “As it happened, most of the people in this study were single,” the report in Psychology Today noted. “Having a dog, in particular, was a good way to get to know other people, so pets could also increase the size of participants’ social networks.” Finding pet-friendly housing can be an issue, according to the respondents. While the subjects were committed to keeping their pets, the housing challenges that pets can present made for a unique challenge. “Because people did not want to give up their pets, they sometimes had to accept housing that was less than ideal or even not safe due to other people in the home,” the report explained. Pets can also have other impacts on an older person’s mental well being, the study found, particularly if an older pet owner endured certain health-related challenges. “As people got older, they sometimes had difficult circumstances to deal with, such as serious issues with their own health,” the report said. “Caring for their pet provided meaning through these hard times, and a sense of things continuing to be the same, at least in some regards. In this way, the pet helped them to cope with the challenges.” Toohey added that while the seniors profiled in the study were generally committed to keeping their pets, the potential housing challenges that pet ownership can present for some older people seeking housing need to be addressed. There is a lot of potential for what she calls “companion animal relationships” to promote health in “many ways that are salient to aging.” These include spurring physical activity by walking a pet, companionship and potential involvement in pet-centric social activities with other pet owners. But certain challenges are also a factor, including the cost of pet supplies, a lack of affordable support if a pet owner becomes ill, and the need for veterinary care. There are also housing-related challenges, which could include “the prevalence of no pet rules to size restrictions to extra fees,” she said. In terms of housing policies tied to aging in place, these barriers could have the most impact, according to the report. “Greater availability of seniors’ housing that allows pets would be very beneficial and would make it easier for people to age in place with their pet,” the report said. “This would benefit those who aren’t seniors too, as more pet-friendly housing would help a wide range of people.”  This is on top of other well-documented challenges older people can face when trying to age in place. These include the high cost of long-term care , a need to create more walkable communities and housing supply illus trates that impact prospective homebuyers of all ages.
By Didier Malagies December 17, 2024
Older homeowners have an overwhelming preference to age in place , but these circumstances can also come with unique challenges. Feelings of isolation and loneliness rank highly among these issues, but a recent study suggests that aging in place with a pet can make a big difference. The study, highlighted in Psychology Today , also noted that having pets in later life can come with its own set of unique challenges , according to Ann Toohey, one of the authors of the study who is based at the University of Calgary. The study followed initial interviews conducted in 2015 by examining how owning a pet impacted the lives of older people aging in place in their homes. According to the study, several takeaways emerged, including that the companionship of a pet makes a difference in their owners’ lives. While the companionship provided is understandably different from what is offered by another person, it also came with other potential social benefits for the seniors who owned pets. “As it happened, most of the people in this study were single,” the report in Psychology Today noted. “Having a dog, in particular, was a good way to get to know other people, so pets could also increase the size of participants’ social networks.” Finding pet-friendly housing can be an issue, according to the respondents. While the subjects were committed to keeping their pets, the housing challenges that pets can present made for a unique challenge. “Because people did not want to give up their pets, they sometimes had to accept housing that was less than ideal or even not safe due to other people in the home,” the report explained. Pets can also have other impacts on an older person’s mental well being, the study found, particularly if an older pet owner endured certain health-related challenges. “As people got older, they sometimes had difficult circumstances to deal with, such as serious issues with their own health,” the report said. “Caring for their pet provided meaning through these hard times, and a sense of things continuing to be the same, at least in some regards. In this way, the pet helped them to cope with the challenges.” Toohey added that while the seniors profiled in the study were generally committed to keeping their pets, the potential housing challenges that pet ownership can present for some older people seeking housing need to be addressed. There is a lot of potential for what she calls “companion animal relationships” to promote health in “many ways that are salient to aging.” These include spurring physical activity by walking a pet, companionship and potential involvement in pet-centric social activities with other pet owners. But certain challenges are also a factor, including the cost of pet supplies, a lack of affordable support if a pet owner becomes ill, and the need for veterinary care. There are also housing-related challenges, which could include “the prevalence of no pet rules to size restrictions to extra fees,” she said. In terms of housing policies tied to aging in place, these barriers could have the most impact, according to the report. “Greater availability of seniors’ housing that allows pets would be very beneficial and would make it easier for people to age in place with their pet,” the report said. “This would benefit those who aren’t seniors too, as more pet-friendly housing would help a wide range of people.”  This is on top of other well-documented challenges older people can face when trying to age in place. These include the high cost of long-term care , a need to create more walkable communities and housing supply illus trates that impact prospective homebuyers of all ages.
By Didier Malagies December 16, 2024
A condo questionnaire is a critical document that lenders use during the mortgage approval process for condominium purchases. It provides detailed information about the condo complex's financial health, rules, regulations, and overall condition. Problems with the condo questionnaire can create delays or complications during the closing process. Here are some common issues that might cause problems: 1. Financial Health Concerns High percentage of owner-occupancy: Many lenders require that at least 50% (or more) of the units in the complex be owner-occupied rather than rented. If a condo complex has too many renters, it could impact the lender’s willingness to approve a loan. Reserve fund issues: Lenders typically want to see that the condo association has sufficient funds in its reserve account for future maintenance and emergencies. If the reserve fund is too low or non-existent, it raises concerns about the financial stability of the association, leading to potential loan rejection. Delinquencies in condo fees: A high rate of delinquencies in the condo association fees can signal financial instability, which lenders may view as a risk. This can delay or halt the approval process. 2. Insurance Coverage Problems Lack of adequate insurance: Lenders require that the condo association carries specific types of insurance, including property insurance and liability coverage. If the condo association's insurance policy doesn’t meet the lender's criteria, the loan may be delayed or denied. Insufficient flood insurance: If the condo is in a flood zone, the association is required to have flood insurance. A deficiency in this area can cause significant issues with closing. 3. Pending or Recent Litigation Ongoing lawsuits: If the condo association is involved in a lawsuit (e.g., against contractors, residents, or local authorities), it can be a red flag for lenders. Lawsuits can create financial and legal uncertainty, so lenders may hesitate to approve a loan until the matter is resolved. History of litigation: Even if the condo association is not currently involved in litigation, a history of legal problems could still concern lenders and complicate the approval process. 4. Non-Compliance with Condominium Guidelines Failure to meet FHA/VA guidelines: Some buyers are using FHA or VA loans, which have specific guidelines regarding condo developments. If the condo does not meet these criteria (for example, not having enough unit owners, or a commercial component taking up too much space), it can prevent the buyer from securing the loan. Non-compliant rules or by-laws: If the condo association's rules or by-laws are outdated or do not comply with lender requirements (such as restrictions on renting out units), it can create issues. 5. Discrepancies or Incomplete Information Incomplete or missing information: If the condo questionnaire is not fully completed or there is missing information about the financials or maintenance issues, lenders may hold up the approval process. Incorrect or inconsistent data: Discrepancies between the information provided in the questionnaire and the condo association’s financial statements can raise red flags, requiring additional clarification or investigation. 6. Excessive Commercial Units or Mixed-Use Properties High commercial occupancy: If a condo development has a high percentage of commercial space or mixed-use properties (residential and commercial), lenders might view this as risky. Lenders prefer predominantly residential complexes since they have a lower risk profile. 7. Special Assessments Upcoming or recent special assessments: If the condo association has recently passed a special assessment (a fee charged to condo owners for unexpected repairs or improvements) or plans to do so in the near future, it can lead to concerns about the financial health of the complex and may affect the lender's decision to approve the loan. 8. Age of the Building Older buildings with deferred maintenance: Lenders might be cautious about approving loans for condos in older buildings that have not been well-maintained. They may require detailed maintenance records or a building inspection to ensure that the property is in good condition. Conclusion Issues with the condo questionnaire that could cause problems during closing typically revolve around the financial stability, legal status, and physical condition of the condo association and its property. It's important for both the buyer and the seller to address these issues early in the process by working with the condo association to provide accurate, complete, and compliant documentation to the lender. By messaging ChatGPT, you agree to our Terms and have read our Privacy Policy. Don't share sensitive info. Chats may be reviewed and used to train our models. Learn more tune in and learn at https://www.ddamortgage.com/blog didier malagies nmls#212566 dda mortgage nmls#324329
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