Can You KonMari Digital Clutter?

October YM_header
image: Can You KonMari Digital Clutter?In a tech-heavy world, many people struggle with an overload of emails, files, and devices. If you’re familiar with Marie Kondo and her beloved KonMari technique to tidying and organization, you may want to apply this technique to digital clutter, or the files and distractions on your electronic devices that lessen your productivity and take away your attention.

The KonMari technique involves picking up every item you’re considering getting rid of and asking whether it sparks joy. If it doesn’t, give or throw it away. You can apply this technique to the extra stuff you have built up on your devices, as well as the emotional clutter brought on by social media and an overload of apps. Go through your browser and ditch the items you’ve been planning to read. If you have extra devices lying around, sell them or recycle them to clear out the space.

If digital clutter for you includes emotional struggles tied to social media or other networking apps, consider taking a break. In these divisive times, social media can become a minefield for disagreements and frustration. You could try unfollowing or muting people, or even deleting the apps from your devices and removing saved logins so it takes more thought and effort to sign in.

By applying the life-changing magic of tidying up to your digital life, you can clear your mind and refocus your efforts as well as increase your productivity.

ources: Vogue, PC Magazine

Low-Light Plants for Cheering Up Your Home

Low-Light Plants for Cheering Up Your Home
image: Low-Light Plants for Cheering Up Your HomeAdding plants to your living space brings a number of appealing benefits. Studies have shown that indoor plants can boost your mood, creativity, concentration, and productivity. Working from home? You’ll love the effect plants have on your ability to focus and churn out good work. Health benefits of houseplants also include cleaner indoor air and a reduction in stress, cold symptoms, sore throats, and fatigue. Plants can also make people feel happy when they look at them.

With so many benefits, it’s easy to see why people add plants to their homes and offices. However, when you’re low on light, you may wonder whether plants can survive in your living space. Good news! There are plenty of plants that thrive in lower-light conditions. One option is lucky bamboo, a member of the Dracaena genus that can grow in water instead of soil. Lucky bamboo plants are also believed to bring fortune and good luck.

Another option is a spider plant, or Chlorophytum comosum, which is one of the most adaptable plants that is easiest to grow. Its spider-like leaves hang down from the mother plant and can grow in a trailing or hanging planter, in a pot, or even in a basket. Certain types of ferns grow well in low light, including the bird’s nest fern, the American maidenhair fern, and the queen fern.

If you want a pop of color in your space, check out the urn or zebra plant. The Aechmea genus of the Bromeliad family of plants thrive in low-light conditions, with color variations between violet and red. You can usually get an Aechmea plant when it has already started flowering, allowing you to choose the color you want in your space.

Don’t let low-light conditions stop you from enjoying the benefits that come with beautiful indoor plants. Instead, opt for plants and flowers that do well without as much sunlight.

Sources: The Spruce, House Beautiful, The Sill

The forbearance crash bros spoke too soon

Recent data should make them sweat their crash call

The health and economic crisis has made 2020 a horrific year for many Americans. Added to all that misery we had terrible fires in the West and hurricanes in the East.  From my perspective, that ball in Times Square can’t drop fast enough hailing the end of this year.

One might think that with all the bad juju circulating the planet lately, people would be extra careful not to bring more misery upon themselves.  One might think that. But then we have our band of Housing Bubble Boys who, shamelessly, never miss a chance to call it wrong in epic fashion.

Some of their biggest hits (or should I say misses) in the last 8 years have been the never-realized silver tsunami crash, the ever popular investor supply crash, the Airbnb supply crash, and this year, COVID-19 was for sure going to send prices crashing 30%-50%. Despite what they promised, we sit here today with the United States housing market outperforming all other economic sectors in the world during the pandemic.

Hey, at least they are consistent in their catastrophic failure to predict what will actually happen.

Also in predictable fashion, after time proves one of the crash theses wrong, our band of Bubble Boys have a proclivity for moving the goal post. The COVID Housing Crash of 2020 that they promised has now been repurposed as the Forbearance Crash of 2021. According to this new and improved crash thesis, when the forbearance plans time out in 2021, home prices will crash 30%, 40% or 50%. This will make their daily trolling of America for the last 8 years worth it.


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These Forbearance Crash Bros, as I started calling them a month ago, have some explaining to do. One of the critical problems with their thesis is that jobs are coming back and this means more folks are likely to voluntarily quit their forbearance plan. There will be lag time in this data but an improved national employment picture is a leading indicator for some of these forbearance loans to be modified and off that data line.

In order for the housing market to crash due to too many loans going into default when forbearance programs end, the number of loans in these programs needs to grow. A 30%-50% crash in home prices next year would require that loans in forbearance go above 10 million. But data released from BlackKnight just last week shows the number of these loans fell 18% and is now standing at 2.97 million. The number isn’t growing; it’s slowly shrinking.

We have a precedent for how housing crashes happen. We just need to look back to 2008 when we had over 10 million delinquent loans. Due to the loosey-goosey lending standards of the time, many of these delinquent loan holders had little to negative equity. Even if two people in a household were working and their loan recast, it still would have been hard to make the payment. Added to this, the cash-out boom from 2003-2006 meant that many households had little to no nested equity when the crisis hit. Needless to say, this was a very precarious and unhealthy market.

None of these factors exist in the market now. Today, while we are still early in the forbearance recovery phase, the number of potentially at-risk loans is under 3 million. Also, whoever the president is next year, you have a good shot that forbearance might be extended under a new format.

Today’s homeowners had a healthy financial profile when they originally purchased their homes and began their loans with some equity. After eight years of price gains, that equity position has just gotten better. And with home prices continuing to rise in 2020, this nested equity is still  rising.  Mortgage demand, too, is at an 11-year high. This is a seller’s market, my friends, not a market on the verge of a crash. Monthly supply data started to get bigger in 2006 two years before the recession hit in America. Housing data started to soften in 2005 after an overheated market.

Here is another precedent: Back in 2012, our housing bear buddies kept insisting that the housing market had 4 million to 5 million homes in what they called shadow inventory. Shadow inventory refers to homes in foreclosure that banks are holding off the market. The Forbearance Crash Bros sees the shadow inventory to a degree similar to today’s loans in forbearance, even though loans in forbearance are not formally foreclosed homes and some of  the loan holders may not even be economically distressed. Anyway, back in 2012, the bears predicted that the shadow inventory would send home prices lower once they all came into the market.

But instead, demand picked up and the monthly supply of homes broke under six months. That year, existing homes sales broke over 4.5 million. To spell it out – even if some forbearance homes hit the market we have the demand to keep prices from crashes. This right here is the biggest failure of so-called housing bubble boys and their band of forbearance crash bros. This sounds like a broadway play.

Why am I so sure that demand will be sufficient to absorb any excess inventory created by the end of forbearance programs to prevent an epic crash in prices in 2021?

First, after 1996 it’s very rare to have any sales print under 4 million. Currently we are pushing hard to get total existing home sales positive from 2019 levels of 5.3 million.

Second, and more importantly, right now the U.S has the best demographics for home purchasing ever.

And third — mortgage rates are very low. I would be mindful of housing when the 10-year yield breaks over 1.94%, if that even happens next year.

So we have the demand we need if the end of forbearance causes a surge of homes to hit the market. If that happens. I am not a big fan of using the term foreclosure crisis leading to 30%-50% price crashes next year either. Here is why I don’t believe that will happen: We do not have an overheated multi-year credit bubble among mortgage holders like we had from 2002-2005.

The chart below (with credit and kudos to Len Kiefer from Freddie Mac), shows that, when adjusting to inflation, mortgage debt isn’t even positive compared to the previous expansion. Also, we have a much higher nested equity position. Do remember that 20%-30% of all homes bought in the previous expansion were bought with cash.

When one considers all these factors, does it really seem likely that we will have a 30%-50% reduction in home prices due to a massive increase in inventory from forbearance loans due to a lack of demand? Demographics, mortgage rates, solid nested equity, jobs coming back — all of these make it seem that it’s very unlikely for the bubble crash to happen next year.

In December I will revisit the topic of forbearance with more specifics. However, as you can see already, the forbearance crash bros might have spoken too soon in 2020.

Until then, stay positive, healthy and safe – and try not to create problems for yourselves by buying into boy-band folklore and fairytales.

Maple Balsamic Pork Tenderloin

Maple Balsamic Pork Tenderloin
image: Maple Balsamic Pork TenderloinAs the weather starts to cool down, many people enjoy preparing and eating warm, flavorful comfort food. Add this delicious pork tenderloin to your menu rotation — it’s packed with flavor and features the moist, juicy consistency that people love about pork tenderloin.

Maple Balsamic Pork Tenderloin

Ingredients:

  • 2 lb. pork tenderloin (cut into two roughly equal pieces)
  • 2 tbsp. cooking oil of your choice

Marinade:

  • 2 dry shallots, minced
  • 2 garlic cloves, minced
  • 1 tbsp. fresh thyme, finely chopped
  • ½ cup pure maple syrup
  • ¼ cup balsamic vinegar
  • 3 tbsp. Dijon mustard
  • 2 tbsp. extra-virgin olive oil
  • 1 tsp. kosher or Himalayan salt
  • ½ tsp. ground black pepper
  • ¼ tsp. cayenne pepper

Instructions:

Mix marinade ingredients until combined. Place tenderloin pieces into a baking dish and pour marinade over them. Toss carefully until both pieces are coated, then cover the dish with plastic wrap or a lid and marinate in the refrigerator for at least six hours, preferably overnight.

Preheat oven to 375 degrees Fahrenheit. Heat 2 tbsp. of cooking oil in a large oven-safe skillet and sear each piece for several minutes per side until all sides are golden brown. Pour remaining marinade over the meat and simmer for about a minute. Cover the skillet with foil and place in the preheated oven for fifteen minutes.

Remove from the oven and spoon additional marinade over the meat. Cook uncovered for another five to ten minutes, or until the thickest part of the meat is at least 145 degrees Fahrenheit. Tent loosely with foil and allow to rest for three to five minutes. Slice into medallions and serve with the remaining maple balsamic sauce. Pairs well with fresh, grilled vegetables or roasted potatoes.

Sources: The Healthy Foodie

Market Recap

  • The consumer price index rose 0.2% in September, as expected. The small increase marked the slowest pace of consumer inflation in four months. The majority of price inflation in September was attributed to the cost of used cars, which jumped 6.7% – the biggest increase in 51 years.
  • For the week ending 10/9, mortgage application submissions saw a composite decrease of 0.7%. Though new purchase application submissions dropped 2% week-over-week, they were still up 24% year-over-year. Refinance application submissions slipped 0.3% from their 8% gain the week ending 10/2.
  • For the week ending 10/10, initial jobless claims rose by 53,000 to reach a new seven-week, seasonally adjusted high of 898,000. Continuing jobless claims, however, declined by nearly 1.2 million, to reach a seasonally adjusted level of approximately 10 million.
  • In September, retail sales climbed for the fifth month in a row. Though economists had predicted an increase of 1.2%, sales jumped 1.9% – much higher than August’s 0.6% increase.

The consumer sentiment index rose again in October, reaching the highest level since March. Though the level was predicted to drop, it rose to 81.2.

Why You Need Grit to Succeed

Why You Need Grit to Succeed
image: Why You Need Grit to SucceedAngela Duckworth is an American psychologist and popular science author. She’s also the world’s leading expert on grit, which is an element of success that she defines as sustained persistence and passion applied to long-term goals. Duckworth started looking into this concept when she was a seventh-grade math teacher, where she realized that IQ wasn’t the defining factor in success. Rather, holding onto and pursuing goals over time was the factor that predicted success in these middle-schoolers.

Duckworth spent the following years analyzing the effects of grit on performance in a wide range of settings, including in school, personal relationships, and career paths, publishing her research in what would become a New York Times bestseller, “Grit: The Power of Passion and Perseverance.” She also shared her findings in a TED Talk that went viral, where she emphasized how grit predicts long-term success in most facets of life. In the TED Talk, Duckworth discussed the importance of “I’ll show you” self-talk, which is a response to “you can’t.”

Duckworth has since founded Character Lab, a nonprofit organization that focuses on advancing the practice and science of character development. She is also a highly sought-after speaker who shares her insights on developing grit and its importance in achieving success.

While grit isn’t the only character trait to focus on developing, it is one that is worth the time and effort it takes to achieve. Duckworth developed the Grit Scale, a questionnaire used to evaluate interest and focused effort over time. You can use the scale to determine whether you currently apply grit in your own life, as well as areas you can improve upon to continue to achieve greater success.

Sources: QZ.com, Digital Promise

How To Get a Mortgage If You’re Self-Employed

How To Get a Mortgage If You’re Self-Employed
image: How To Get a Mortgage If You’re Self-EmployedWhether you’ve owned your business for many years or started a new one, self-employed people can and do get mortgages.

Typically, lenders prefer to see a minimum of 2 years of tax returns along with bank statements, how long youve been in that field, year-to-date profit and loss, and other assets which provide them with the income stability and consistency they are looking for.

They will also look at the type of business (S-Corp, LLC, Inc, Partnership, etc.), its financial strength, demand for product/service, and future outlook.

However, income stability and consistency are two factors that stand out with self-employed applicants.

Exceptions do exist.

There is a big difference between a borrower who is self-employed for one year and in the same field of work for many years, compared to the borrower who is self-employed for one year in a new field of work.

For example:

  • If you were a W2 employee, in the same field of work for 5-7 years, making $50,000, and decided to open your own business less than 2 years ago, you may not need 2 years self-employment history because you’re in the same field and are making similar or more income. In this example, you’ve provided both income stability and consistency with long-term experience in that field.
  • If you are a self-employed borrower in a new line of work, you may need to wait until you can provide 2 years of income stability and consistency even if you have the current income to qualify and are making more than you were prior to opening your new business. In this example, you meet income stability but not the consistency requirement because you are in a new line of work and there is little to determine the business’s future survival.

Bottom line: Having a loan officer who is an expert in helping self-employed borrowers can be greatly beneficial. They can look at your overall situation and recommend which type of mortgage and timeframe work best to fit your need.

If you or anyone you know has questions about home loan rates or products, please reach out. I’m always happy to help. Enjoy this month’s issue of YOU Magazine.

Sources: Mortgage Market Guide

How to Know When to Refinance Your Mortgage

How to Know When to Refinance Your Mortgage
image: How to Know When to Refinance Your MortgageWhen interest rates drop, many homeowners wonder whether it’s worth the effort to go through the process of refinancing. The decision to refinance your mortgage depends on several key factors, including:

  • The current interest rate for which you can qualify
  • How long you plan to live there
  • How long it may take to recoup any closing costs
  • The reason you want to refinance (lower your payment/interest vs. consolidate debt or tap into home equity)

In many situations, refinancing is well worth the effort, as it can drop your monthly payment and reduce the amount of interest you’ll pay over the life of the loan. Refinancing is generally easier than securing financing for the property in the first place, and any equity you’ve built in the property aids in the refinancing process as well.

If you can qualify for an interest rate that is at least a full percentage point lower than what you currently have on the loan, it may be wise to refinance. It also makes sense if the refinance will allow you to eliminate private mortgage insurance (PMI) from your monthly payment.

As you decide whether you want to refinance your mortgage, consider any closing costs that you’ll have to pay. In most cases, the closing costs are between 3% and 6% of the loan value, so consider how long it would take to recoup the total costs based on your decreased monthly payment.

Some lenders offer to roll these into your loan as part of a refi, but you end up paying interest on the added cost over time. A “no-closing-cost” loan can also seem appealing, although this option is usually only available with a higher interest rate, which defeats the purpose of refinancing in the first place. As you consider these factors, you can make an informed decision as to whether a refi is worthwhile.

Sources: Nerd Wallet, Investopedia

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Nancy Pattison
NMLS# 602769; Branch NMLS# 1908476
Joint Venture Divisional Manager | CMG Financial
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121 Circle Slope Drive  | Simpsonville, SC 29681

Here’s how homeowners and new buyers are taking advantage of record-low mortgage rates

Opinion: Here’s how homeowners and new buyers are taking advantage of record-low mortgage rates

Published: Sept. 12, 2020 at 3:38 p.m. ET

Millennials drive the buyers’ market, while Gen Xers look to refinance

Buying a home is quite different from refinancing one. Indeed, buying a home is a highly emotional and transformational experience. When you buy a home, you feel secure and confident about the future.

Mortgage rates have fallen to record lows. As a result, this summer applications to purchase a home surged to the highest level since 2009. New house sales have also jumped to the highest level since 2007. Low rates have resulted in an increased volume in refinancings, which is on track to grow to the highest level in 17 years.

For a lender, purchase loans are a more stable and predictable business than refinancings, which are more geared to fluctuations in interest rates. Typically, homeowners refinance because they want to lower their monthly payments. Here’s what my home-loan company has learned about our customers who are obtaining a loan to purchase a home and those who are refinancing one:

1. Millennials drive the purchase market: Millennial buyers make up 54% of our customers who have purchased a home so far in 2020.. This might be because of the sheer size of the millennial generation. In fact, they are now the largest generation in the U.S., having overtaken baby boomers. The millennial population is also growing as young immigrants join this cohort. While many of these millennials have to rely on the “Bank of Mom and Dad” to obtain the funds for the down payment, they view owning a home as an important and transformational step in their lives.

2. Generation X drives the refinance market: Generation X makes up 31% of our customers who have purchased a home this year. Yet when it comes to refinancings, Gen X leads with 41% of these customers, while millennials make up 36%. Gen Xers are later in their careers and have owned their homes for longer than millennials. They can therefore refinance in greater numbers.

3. Those with high FICO scores drive purchases and refinancings:  Our customers with a FICO score above 720 reflect 64% of purchase loans and 76% of refinancings year to date. Those with FICO scores between 680 and 719 make up 18% of purchase loans and 15% of refinancings. Understandably, people with higher credit scores can more readily obtain the financing for home loans and take advantage of lower rates to refinance.

4. High-income individuals lead refinancing activity: Our customers who earn between $150,000 and $300,000 annually make up 29.4% of those refinancing their mortgages year to date. Those with an income between $100,000 and $150,000 comprise 29.1% of refinancings. Yet when it comes to purchasing a home, those who earn the most money make up 22% of purchases. Those earning between $100,000 and $150,000 comprise 25% of purchases. Put simply, high-income individuals are on the lookout for ways to lower their monthly mortgage payments.

5. Home buyers have a higher debt-to-income ratio: Another revealing finding is that our customers with debt-to-income (DTI) ratios between 41% and 50% make up 38% of the total amount year to date, the largest among our customer base. When it comes to refinancing, our customers with a DTI below 35% make up 52% of refinancings this year, which is the largest segment among our customers. This is logical, as those who are refinancing may have owned their homes for longer and are likely to be later in their careers, so they have lower DTIs.