American Pacific Mortgage

American Pacific Mortgage

Tuesday, May 10, 2022

The Sky IS NOT Falling!


Interest rates continue to rise, but we expect them to level out somewhat through the rest of 2022.  Although the Fed just bumped up the Fed rate by .5% this does not correlate directly with mortgage rates. Most lenders have already built in the anticipated increase in their rates.  Mortgage rates are generally based upon current yields (rates) of mortgage-backed securities as traded on the open market.  The ten-year Treasury is also considered a benchmark but does not correlate directly to mortgage rates. 

ARM loans (Adjustable Rate Mortgages) are making a comeback, particularly the 5-year ARM.  Remember, most homeowners don’t own the same home or loan for more than five years, due to changing circumstances.


We want to re-emphasize that we do not anticipate a drop in home values.  We do expect a slowdown in appreciation rates (which was over 20% countrywide last year) but there is no reason to believe homes will drop in value.  Although we may be heading into a recession in a response to the move to reduce inflation, the worst we expect to see home appreciation drop to is around 4.5% to 5%.  Inventory of homes for sale continue to be at record lows.   Remember, real estate is the best hedge against inflation and a great long-term investment. And coastal California real estate is always in demand.


Although the Refi boom is past us, there are still many reasons for a refinance.  Life transitions such as divorce or death of a family member present the continued need for home financing whether to purchase a new home or refinance an existing one.  Remodeling and home improvements are another.  We can always assist with HELOC loans as needed for some of these situations.


We recently closed a purchase loan for a client going through a divorce.  We worked closely with all parties involved to assure she would qualify for the new home purchase.  Watch this brief video to learn more:  CLICK HERE


APM was the #1 FHA lender in the state of California in 2021.  Yes, that means we work with a lot of first-time homeowners. 


The Dance craze is continuing with new Cardio Funk classes on Saturday mornings in the Dana Point Harbor.  Join us at the Piazza Wellness Center at 10:00 a.m. for 90 minutes of great cardio and a ton of fun! Piazza Wellness Center


We just returned from a weekend in Ensenada for the Newport-Ensenada sailboat race.  There were 120 boats that participated in several classes.  Steve crewed on Freedom, a 55” Beneteau that won First in Class, along with three other first place trophies.  However, he missed the wine tour we had at Casa del Piedra, in the Guadalupe Valley followed by a fantastic lunch.  Fabulous time!

We head out in June for scuba diving in Cozumel, a Caribbean Island off the coast of Cancun, Mexico. 

Steve will do some painting while I read in the shade.  Here is an example of his tropical fish.  See more at  Shameless plug! 


Life is Good!  And don’t hesitate to call us with any questions you may have.