Markets are not doing very good lately...and there's no real indication that they are going to get better. One "event" like a terrorist attack or something similar could really start a negative slide.... or should I say a slide even worse than we are seeing now
You may want to take a close look at your elections and drop your $$$ in a stable value fund or something similar until this blows over so you dont lose your ass. Recession is only a formal announcement away.


R-

Thanks. I already lost most of my nest egg value in 2001-2005.

401k's simply allow your employer to spend your pension as they deem fit and are just yet another reversal of New Deal Social programs.

Now just imagine if Social Security & Medicare becomes privatized...into some outfit like Enron where the CEO take take the Nation's Pension Plan and transfer it to his Cayman Island Account.

Recession my ass. Unless outsourcing is outlawed we're looking at a Depression.

This is merely a buying opportunity. Lot's of cheap stocks out there right now if you get in long. Most likely the market will fluctuate through the election and then take off. With the value of the dollar in the toilet there will be a lot more foreign investment in the US this year.

I recently moved most of my retirement into foreign investments. They are more stable and at the rate the US dollar is taking the plunge, it's a wise move.

Take your money to Vegas and play high stakes card games 'til you go broke or get rich

I won't set foot anywhere near the stock market while The Bush Boys are running the FTC.

Here's what I am telling my clients.........

Money already in invested.....only move 20% to a safer position. The other 80%: ride it out.

New money to be invested....move 20% in now(there are some good things to buy) and hold the other 80% out (in 3 to 6 month CD's) until the b.s. with the banks/mortgage companies smooths out.

Don't panic. The Dow went from 10,500 to 14,000 in two years. When you feed a baby too fast it burps. The stock market just burped. Memo to U.S.A.: Start feeding it again slowly and don't lend $ to morons who would rather walk away from a house than work to keep it. I'd sell my left *&^% before I would walk away from my home.

What's the going rate for a left nut?

Seriously, if I could hang onto our waterfront place till the market improved I could easily get another $100,000 out of it. Unfourtunately, divorce "requires" me to walk away.

Whats bad for stocks is good for mortgages, as of yesterday imo we have just started another refi boom. I locked MANY client in this week on 30 fix at 5.375% and 15 fix at 4.875%...the rule of thumb in my business is the more turmoil and negativity in the economy the better I do...I am seeing many investors coming off the sidelines this week as well ready to buy. Be happy you live in this state, it is kicking ass compared to the rest of the nation...cheers.

Do you think the .5% rate cut the Fed is supposed to announce at the end of the month will drive the 15 and 30yr fixed rates down even more? Say to maybe 4.5 and 5.125 ?

NO, it is priced in right now. Fed rate cuts drop short term debt IR immediately ie variable rate credit cards, heloc's etc...the bond market anticipates fed action well in advance and prices accordingly weeks before it actually happens. There are other more direct cause/effects on mortgage rates but keep your eye on the 10yr T-Bond, that is the best indicator for us common folk of what fixed mtg rates are doing. Prices up, yield down is what you want if you are wanting to buy or refi.

IF the fed does something other than expected, fixed rates often go up the same day the fed announces a cut. I have a helluva time explaining that to people as I get a bunch of calls each time the fed cuts rates but ive seen it happen MANY times.

As of today we are essentially right back where we were in the summer of 03, all time record low rates...i gotta run my phone is ringing steadily for the first time in a year...cheers

Working for the fed govt we have only 4 investment choices for our retirement accounts. All pretty conservative, the riskiest being tied to the S&P Index.

Yep, I've watched my Annuity slip 46K in just the last few week's. I'm still young though.

Mf

Mortgage rates will continue a slow drop down over the next few months. They'll drop below 5% for 30 year mortgages within 3-4 months. Had a meeting with the head of our mortgage unit Friday.

Fed meets end of this month and again in March. Look for 0.5% and 0.25% drops respectively. As summerrun said, Fed rate drops do not corrolate directly to drops in mortgage rates.

It will be a good time to refinance in a few months. If you see 30 year fixed rates hit 5%, get your application in. Better yet, get your information ready now. Go fixed rate only, no option ARM B.S.

That's music to my ears Andy, as we need to refi in April. Hopefully we hit things just right. I'm taking summerruns advice and getting prepared now so when the time comes I can lock in and slap everything down for a quick turnaround.

Don't be worried about it hitting it just right, just get a good spread from where you are today. Once you get a 1-1.5% drop in rates it would be wise to pull the trigger (the higher your mortgage amount, the lower the rate change necessary to realize a quick recapture of refi fees). Once you pull the trigger, don't look back.

On a $300K mortgage dropping from 6% to 5%, payments would drop from $1,798 to $1,610. $188x48 months = $9024. If your closing costs are lower than this $9,024 amount over the next 4 years, you came out ahead. (They really should be lower than this, if not, you are getting hosed.)

Same mortgage but on a 15 year term, rate going from 6% to 5%, payments go from $2,531 to $2,372.

There are a few mortgage pro's here that may correct me, but the general rule is that if you plan on staying in your home for 4-5 years or more, pay the points (loan fee). If you plan on selling in less than 4-5 years choose the lower/no points option.

For example, loans on any given day are 5.375% with a 1% fee, or 5.5% with a 0% fee. The fee needs to be calculated as part of your overall interest cost for the estimated holding time to figure your break-even point.

Should be a good time for folks in the mortgage business in the next few months.

Here is a link to a great loan calculator.
Loan calculator

I'm already at 5.625 on a 20, but will be paying attention for the next couple months. Thanks for the post Dogfish.

Me too Tim.........that sh!t has scored a touchdown for us, 23% growth in past 24 months. Domestic stuff has sucked mooseweenie BIG TIME.

Luckily I already have 25 left on a 30 year at 5.15% so I'm good for that.....

If you have a bad heart, DON'T CHECK YOUR ACCOUNTS EVERY DAY dudes! that will just depress you one day and make you think you're Donald Trump the next.

Yep Auntie, you are correct. It's not about how much you make but about how much you keep.
If anyone is interested, there are self directed 401k's available. A co-worker rolled over one to a condo purchse for a rental. She bought and sold and the right times and did well. The foreclosure market is making money for some people. I know a couple of guys that have bought and sold several houses since spring. They resell under the going market so they can turn them quickly.
Banks and mortgage companies have their real estate owned (REOs in the biz) properties online and are anxious to dump them so if you are thinking about buying check online for what's available. Regardless of what some people think, lenders do not want the properties. Google REO and lenders websites should show up.They want the money to reloan and aren't set up for handling rentals or maintenance.
Our real estate market in the NW, imo, will suffer but not like most other areas. One of my sons lives in Columbus, Ohio, and there are new subdivsions back there built out and nobody home. I've worked in the real estate field in Western Washington in various capcities for 30+ years including during the interest hike that started in late '79 when a friend had to pay 22% on commercial money. Some people reach a point in their lives where they have to sell and it creates an opportunity for someone else particularly with the prevailing interest rate for loans. Like the old adage about real estate says -They aren't making anymore of it.

Put your money in an off shore account! or a Swiss bank account. The Chinese are coming!! Gung hay fat choi!!!!

Foreign markets taking a major beating today. I wonder what tomorrow will bring?

The report I just read is showing the S&P futures DOWN 5%+ to open in the am...looks like it will be a wild week I better get in the office early tomorrow...cheers.

Crazy start already, emergency Fed cut of .75%. THAT will drop mtg rates today, last I saw Dow opened down 400+pts...

Just don't freak out and react to the media. It is a good time to look for stocks on sale.

absolutely...think buyers are jumping in now as the Dow and Europe are not doing that bad compared to the opening but I will leave the non mortgage stuff to those in the know as thats not me. Interest Rates dropped an 1/8 to 1/4% across the board so far this am...cheers

The Fed's hitting the panic button!

wild ride lately, poor month actually last two over all on the year was stellar. Remember the fundamentals Buy low sell high.... I am starting to look at what bargains are out there

Andy,

Hopefully the mortgage market is the bright side to my not-so-rosy retirement fortune. I'm hoping to break ground in the next 3 months on a new house, so maybe I can get my interest rate locked in here in a few weeks or so.

Sg

Just a real-time update and as Dogfish said on another thread, "im not trolling for loans"...just giving info...Rates continue to PLUMMET is the best word I can use...by the end of the day today we could break through the 40 yr lows we set in 2003...stocks are getting pounded again but if you have been thinking about buying a house the combo of lots of inventory and record low rates should get housing moving again asap...cheers

With talk of another rate drop in the near future would it be best to wait until then?

REAL TIME UPDATE: Mortgage rates JUMPED WAY UP late today. A HUGE volatile swing right at the end of the session. Rates are running exact opposite of the stock market. We had THREE rate jumps in less than an hour from many lenders....chaos is alive and well in the markets right now. cheers

Mutual funds?

Checked the rates at WA Mutual this afternoon.

4.75% - 15 year fixed

5.25% - 30 year fixed

so let me ask you this...if i got over 40k in my 401k...where the heck do i invest it in?...im afraid to loose money, would that put me in moderate or something?...i have been afraid to put it anywhere, when i started my 401k everyone was loosing big money...i know im stupid for not changing it, but it has been getting some interest...now my company starting this month is matching 3.5% of my pay instead of 500 bucks a year...im going to bump it up from 7% of my pay to at least 12% we will see if i can afford 15%...but with the chance of loosing money, it scares me...is this normal...i dont know jack about 401's...c

LTF,

If you invest it in stocks or mutual funds (usually a mix of stocks) you will gain some years and lose some years. It's kinda' scary in its uncertainty, but over the long haul to retirement, a good mutual fund will average 8% or better. I don't have access to more risky investments, being tied to the S&P 500, but S&P does pretty well over the long haul. The years 2001 - 2005 were pretty painful for everybody except those who were holding their 5% gov't bonds.

A cautious approach might be to invest half your contribution in bonds and half in a stock mutual fund. A balanced portfolio is usually recommended for people investing in retirement accounts. I started saving after I was 40, so I put as much as I could in "growth" funds, which are higher risk. They swing up and down more, but overall they do pretty well.

Since I'm not a financial advisor, your best bet is to spend a few bucks and hire a pro who just charges an hourly fee, not one who manages your fund and takes a commission.

Sg

KK is pretty spot on.

If you can sleep at night, you made the right decision on your investments.

Wait a few months to pull the trigger on a mortgage. April will be very interesting, August and September as well. What the FED does next week may have an impact. From what I've read (Fun banking industry literature) the FED will cut rates by another 1-1.5% over the next 8-10 months. These rate drops will not be one-for-one on mortgage rates, but it will have some effect.

Don't try to hit the bottom, 'cause you won't. Just try to get a good drop.

One other thing, reflect on if your mortgage payment has changed, your personal income has been impacted, or your employment outlook has changed before you react to anything the media is telling you. They have a tendancy to sensationalize things.

thanks Salmo KK and Dogfish...ive been trying to figure it out, and i do have Vanguard, im going to give em a call and try to figure some of this out...thanks guys!!! oh yeah sorry it took sooo long to get back here, ive been going crazy with name changes...thanks...c

I think what gets lost in all of this discussion about retirement funds is the real killer in retirement and that is inflation. A well managed and diversified 401K plan is your best protection against inflation, despite what has happened with the economy of late (IMHO).

I think Aunty M's approach to living is the best piece of advice. Hell, the country wouldn't even be in this mess if people learned to live and enjoy life within their means. My wife and I will retire in about a year. We live simply now and will live even a simpler life in retirement, but a great life none the less.