Tag Archives: Loan

NY Federal Reserve Tweet : Total Consumer Debt DOWN in Q 2 2020 …What? … Deep Dive into the Consumer Balance Sheet

Mid-Week last week, a NY Federal Reserve Research tweet lead to the following report….

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Q 2 2020 Consumer Debt DECREASE?

Not believing the headline…. How could there have been a DECREASE ?

A deeper dive into the report was due!

In prior writings/research this report has been a staple of a resource so familiarity in the set up made the review easier…

In fact, Q 2 2020 shows a decrease in total consumer debt!

Notice the rise up to the great slowdown of 2007-2009 and then a pull in the wings for about five years, until early 2014?

Did it take five years to regain confidence?

Certainly, this could be just a blip, as one quarter does not a trend make.

If it does continue down, as it did during the post 09 peak, we should be able to infer there is a great belt tightening ability across the board for the consumer….

Q2 2020 total Debt

The following chart, also from the same report shows a drop in delinquency status, predominantly in the 120 day range … this may be a result of some of the forbearance ability due to the stimulus packages, but logically that should hit the shorter term, in our opinion.

Q2 2020 Total Delenquency Status

Lastly, digging even deeper, the drop by loan type is showing the most movement in the shorter term and most evil credit card balance, followed by the less evil Auto Loan….

Q 2 2020 Total Account By Loan account

Could we really be turning Lemons into Lemonade ?

Hope So!

Have a Great “Puzzling but Hopeful Consumer Debt” day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
jkfinancialinc
street-cents

Mortgage Rates Reach ALL TIME LOW According to Freddie Mac … Get Ready, but Wait (days, not weeks) to Pull the Trigger …

As the experience notches in the belt gain in quantity, we have learned the follies of attempting to PREDICT or FORECAST events …. luckily we gave a soft “heads up” that rates MAY be in our corner due to the Corona Virus, and help with longer term Mortgage and other longer term fixed interest rate loans ….

Freddie Mac Reports Lowest Mortgage Rates EVER

According to Freddie Mac….

“The average 30-year fixed-rate mortgage hit a record 3.29 percent this week, the lowest level in its nearly 50-year history. ” 3-5-20

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Here is the deal…. rates fell AGAIN in the most recent week due to fears of Economic slowdown from the Corona Virus…. but maybe TOO FAST for Mortgage and other longer termed Fixed Rate loans to adjust … On Friday, after the above rates were calculated, the 10 year Treasury, our guidepost for rates, dropped another 22 Basis Points or almost another 1/4 point ….. 

Far right, the 10 year treasury yield fell like a rock as fear stoked investment from across the globe…. yesterday for the first time it took a breather as bonds fell and rates rose…no matter, these are Low Low Low rates!

3-10-20 Ten year treasury

Reach out to your bank, Mortgage Broker, or other refinancing officer, and get your documents in order … begin the qualification process but WAIT (days, not weeks) just a bit and check with your loan professional before locking that rate as it is likely the recent drop in rates has not yet dripped through the loan system…. hopefully better loan rates may be in our very near future…

Here is your friendly reminder on Refinancing or not:

“Think 18 months cost break even – We like to have the saving from the refinance cover the cost of the refinance within 18 months – i.e. Person with $30k mortgage at 5% probably would not need to refinance to 4%, but a $3 million mortgage may be smart to refinance from 4.25% to 4% or the like, if the numbers work out.”

Here is the complete Post which contains 11 items to remember when refinancing!

Take advantage of what cards we are dealt!

Have a Great “All Time Low Rates” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
jkfinancialinc
street-cents

Why the fine print can still be important!

Occasionally it is easy to let our guard down and …. Trust the System….

While we try never to be negative, but slightly skeptical … helps keep unfair practices from our Wallets.

Recent Reminder of the Small Print

This is a quick snap shot from the cell, such the slight blurred view…

Yes that is an annual percentage rate charge of almost 100% – wish we could invest with those types of returns… but this is an annual charge … Think this is the highest charge ever seen…

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This offer came via a unique letter that look like an offer for a charitable donation … reading the fine print, it was actually a short term loan offer in disguise, sign your name and return the letter and your on the hook for an almost 100% annual loan….

Skeptical, not negative … it happens still ..

Hat tip ZC!

Have a Great “Read the fine print” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
jkfinancialinc
street-cents