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Tyler Carlston

Loan Originator |NMLS 1857360

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As your trusted UMortgage Loan Originator, my goal is to simplify the mortgage process to make your home loan experience easy to navigate! Please reach out so I can help start your home financing journey.

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Housing Market Update | Week of June 30th

After holding steady for nearly the entire month of June, mortgage rates finally dropped last week. This slow downward trend was driven mainly by headlines from Fed Governors suggesting that it could be time for a rate cut, as well as President Trump stating his intention to pick Jerome Powell’s successor as Federal Reserve Chairman. There’s been a lot of pressure on the Fed to cut rates from outside voices, and this week could ramp up that pressure with the right data. We have a short week ahead with the Fourth of July this Friday, but no shortage of data that could shift mortgage rates this week. It’s the last jobs week before the July 30th Fed Meeting, and if we want to see a rate cut in July, this week’s reports will need to show significant weakness in the labor market. Bad labor data this week would only increase pressure on the Fed to cut rates. With markets closed on Friday and some big data coming Thursday morning, let’s connect early in the week to make sure our clients don’t get caught in any market volatility. Last Week's Mortgage Rate Recap Rates Dropped Mortgage rates finally dropped last week, but not because of Friday’s PCE inflation report. On Wednesday night, President Trump announced that he is considering nominating his pick to succeed Fed Chair Powell 11 months before Powell’s term ends. This move would undermine Powell and increase pressure on the Fed to cut rates. This caused the 10-year yield to dip, driving mortgage rates slightly lower. This dip came to a halt on Friday morning as the PCE report, the Fed’s preferred measure of inflation, showed that headline inflation rose 1% in May and 2.3% year-over-year. This was right in line with market estimates and prevented bonds from continuing to drop into the weekend. This Week's Mortgage Rate Forecast Rates Could Be Volatile This week is jobs week, with four major labor reports coming between Tuesday and Thursday. Continuing jobless claims, which record the number of people who have filed for and are currently receiving unemployment benefits, hit a 3-year high last week. This means that unemployed individuals are having a harder time finding a new job, which could hint at increasing weakness in the labor market. Here’s what’s coming this week: Tuesday: Job Openings, Losses, and Turnover Survey (JOLTS) Wednesday: ADP Employment Report Thursday: Bureau of Labor Statistics (BLS) Jobs Report, Initial Jobless Claims The markets expect 120,000 jobs created in the ADP report and 115,000 in the BLS report, as well as an increase in the unemployment rate to 4.3%. All signs point to a labor market that continues to weaken, but will this week’s data be weak enough to prompt the Fed to act this month? If we see weak labor data this week, the table is set for lower mortgage rates. Typically, markets tend to overreact when a report like the BLS report is released the day before a 3-day weekend. While we might see rates drop, make sure to make sure to stay in touch with your UMortgage Loan Originator so your clients don’t get caught in any potential market volatility as they enjoy their July 4th festivities.

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What Are Seller Concessions? A Simple Guide for Homebuyers and Sellers

What Are Seller Concessions? A Simple Guide for Homebuyers and Sellers Buying a home comes with a lot of upfront costs. Between the down payment, closing costs, prepaid taxes, and insurance, the amount you owe at closing can add up fast. That’s where seller concessions can come in. Whether you're a homebuyer looking for a little financial relief or a seller trying to attract more offers, this guide will walk you through what seller concessions are, how they work, and how they benefit both sides of the transaction. What Are Seller Concessions? Seller concessions are when the home seller agrees to pay certain costs on behalf of the buyer as part of the purchase agreement. Seller concessions most often cover things like title fees, taxes, insurance, and other expenses that come due at closing. Instead of reducing the sale price of the home, a seller might agree to pay some of the buyer’s costs to help make the purchase more affordable. It’s a way to get creative with negotiations, especially in a market where buyers may be struggling with high interest rates or limited cash. How Do Seller Concessions Work? Here’s an example: Let’s say you're buying a $300,000 home and ask the seller to contribute 3% of the purchase price ($9,000) toward your closing costs. If the seller agrees, that $9,000 can go toward things like your appraisal fee, loan origination fee, or even buying down your interest rate. The key thing to remember is that seller concessions must be negotiated upfront and written into the purchase contract. Your mortgage also needs to allow them, and each loan type sets limits on how much a seller can contribute. We’ll touch on that shortly. What Can Seller Concessions Cover? Seller concessions can be used to cover many of the upfront costs involved in purchasing a home, including appraisal fees, title insurance, loan origination fees, property taxes, and homeowners’ insurance. Seller concessions cannot be used for your down payment or to help a borrower qualify for the loan; they’re only allowed to cover closing costs and prepaid expenses. Seller Concession Limits by Loan Type Each loan program has its own rules about how much a seller can contribute. Here's a quick breakdown: Conventional Loans: Less than 10% down: The seller can contribute up to 3% of the home’s price. 10% to 25% down: Up to 6% in concessions allowed. More than 25% down: Up to 9% in concessions. Investment properties: Only 2% allowed, regardless of down payment. FHA Loans: Flat 6% seller concession limit regardless of the down payment amount. VA Loans: The seller can contribute up to 4% in concessions, in addition to paying for standard closing costs as permitted by the VA. This 4% can be used to pay off a buyer’s debt, cover prepaid expenses, or even fund a temporary buydown. USDA Loans The seller can contribute up to 6% of the home’s purchase price toward the buyer’s closing costs and prepaid expenses. Why You Should Negotiate Seller Concessions as a Homebuyer or Seller Seller concessions have plenty of benefits for both homebuyers and sellers. Here’s why you should consider them depending on your side of the transaction. How Seller Concessions Benefit Homebuyers Lower Out-of-Pocket Costs: Concessions reduce the cash you need to bring to the table at closing. Easier Loan Approval: By lowering your upfront costs, you may have more flexibility in choosing your loan program or interest rate. Buydown Opportunities: You can use concessions to buy down your interest rate, which can lower your monthly payment for the life of the loan. How Seller Concessions Benefit Sellers Attract More Buyers: In a market with less demand, offering concessions can help your home stand out and attract more buyers. Faster Closings: Buyers who receive concessions may be more motivated and financially ready to close on time. Higher Sale Price: In some cases, sellers can offer concessions instead of reducing the list price. Seller concessions are a powerful tool that can make homeownership more accessible for buyers and help sellers move their homes more quickly. Whether you're buying or selling, working with a local mortgage expert can help you understand exactly how seller concessions fit into your overall game plan. Ready to talk through your options? Follow this link to get connected with a UMortgage Loan Originator near you.

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How the Federal Reserve Impacts Mortgage Rates (And How It Doesn't)

If you’ve been watching the news lately, you’ve probably seen a lot of headlines about the Federal Reserve and interest rates. And if you're a homebuyer or a real estate agent working with buyers, you might wonder: Does the Federal Reserve control mortgage rates? It’s a great question. And the short answer is: Not necessarily. The longer answer is a bit more nuanced because while the Fed does play an important role in the economy, it doesn't directly control mortgage rates. What Is the Federal Reserve and the Federal Funds Rate? The Federal Reserve—often referred to simply as the Fed—is the central bank of the United States. Its primary job is to keep the economy healthy by keeping inflation in check, supporting the labor economy, and promoting stable & sustainable economic growth. One of the main tools the Fed uses to manage the economy is the Federal Funds Rate. This is the interest rate banks charge one another for overnight loans. While consumers don’t pay this rate directly, it has a ripple effect across the economy, influencing rates on credit cards, auto loans, and savings accounts. How the Federal Funds Rate Influences the Economy When the Fed raises the Federal Funds Rate, it becomes more expensive for banks to borrow money. That tends to result in higher borrowing costs for consumers and businesses in an attempt to slow down inflation and prevent the economy from overheating. When the Fed lowers the rate, borrowing becomes cheaper. This encourages more spending and investment, often a strategy used during economic slowdowns or recessions. Important distinction: The Federal Funds Rate influences the economy, but it does not directly control mortgage rates. Why Mortgage Rates Don’t Always Follow the Fed Here’s where a lot of confusion begins. Many people assume that when the Fed raises interest rates, mortgage rates automatically rise too. But that’s not how it works. Mortgage rates are driven by a different set of economic factors, mainly the bond market. Specifically, rates are closely tied to the 10-year Treasury yield and the performance of mortgage-backed securities (MBS). Investors who buy these securities care most about the labor market, inflation, the long-term economic outlook, and market stability/instability If inflation is rising or expected to rise, mortgage rates tend to increase. If economic conditions appear weak or uncertain, rates can fall, even if the Fed is raising the Federal Funds Rate. In fact, mortgage rates often move in anticipation of what the Fed might do, not just in response to what it has done. The markets are always looking ahead. What Really Drives Mortgage Rates? Here’s a quick snapshot of the major factors that impact mortgage rates: Inflation: Higher inflation usually = higher mortgage rates. Economic Growth: A strong economy can lead to higher rates. Global Events: Uncertainty (like geopolitical conflict or pandemics) can drive rates lower. Bond Market Demand: More demand for mortgage bonds often = lower mortgage rates. In other words, mortgage rates are influenced by a wide range of factors and are always forward-looking. Want more in-depth analysis of the housing market? Check out our weekly Housing Market Update blog. How Homebuyers and Real Estate Can Navigate the Market For homebuyers and the real estate agents supporting them, the key takeaway is this: Don’t assume that a Fed rate cut means mortgage rates are going down. In some cases, mortgage rates don’t move much on the day that the Fed cuts rates. Most of the time, they will drop in the lead-up to a Fed Meeting if a rate cut is expected. Other times, they might drop after a Fed announcement, depending on how markets interpret the economic outlook. If you’re considering buying a home or are an agent for a hesitant buyer, here’s how you should navigate periods of market instability: Focus on personal goals and timing, rather than trying to time the market. Work with a knowledgeable mortgage professional who can explain how market shifts impact your unique situation. Make informed decisions based on the bigger picture, not just headlines. Whether you're buying, selling, or considering a refinance, UMortgage Loan Originators are here to help you navigate the market with confidence and leverage homeownership to build wealth. If you’re curious about your homebuying or refinance options and want expert guidance, fill out this form to get connected with a UMortgage Loan Originator in your area!

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