The Great Waiting Room

Alexis: Hey, everybody. Welcome back to the Mortgage Rundown. My name is Alexis Quinney and I'm here with Jason Obradovich, CIO of New American Funding. How have you been doing, Jason?

Jason: I'm doing great. How are you?

Alexis: I've been doing good. So, since we last spoke, Biden is officially in office. What can you tell us about that?

Jason: You know, as of right now, it's still really early. There are some executive appointments going on. They have a new Treasury secretary that was just confirmed — that’s Janet Yellen, good for the market because she's a known entity. We also have a new CFPB director, but there's not a lot of knowledge around this person. They did work for Elizabeth Warren. So, there could be some issues there. But by and large, this is still really early. They made their appointments, but we really don't know yet necessarily what the policies are going to be that might impact housing.

Alexis: OK, and I know the Fed meeting happened yesterday. So, were there any announcements there that we should know about?

Jason: You know, by and large, the meeting was a non-event. They left interest rates unchanged, which is near zero. It's going to remain near zero for the foreseeable future, likely till the end of 2022. And they did caveat that the pace of recovery is moderating, which isn't great, not bad, but not great. And really, it's going to come down to the vaccination. How much are going to be able to inoculate this country and get it up and running again…will really determine the speed of the recovery. And so, you know, what we've seen so far at least, is there's been no change to mortgage rates. You know, over the last month, we've seen them slowly move up and now they're starting to slowly move back down. We don't necessarily know how they're going to deal with forbearances and so many millions of borrowers that are getting further and further behind on their mortgage payments. So, those are all things to come. But right now, we're still in this transition phase where it's a new administration. We don't know all the policies. We don't necessarily know all the legislation. There have been some executive actions. The Fed has come out saying a lot's going to depend on the vaccinations and the economy opening, but we're still in a wait-and-see mode.

Alexis: Yeah, definitely. It's definitely felt that way. So, I think there's maybe a lot of changes to come. But it sounds like right now we've been kind of steady.

Jason: Yeah, I think we'll know more over the next few weeks, in the next month, really what this administration plans on doing or at least what they think they can get passed in terms of legislation. Because remember, they have 50 seats in the Senate, which is technically a majority with the Vice President breaking ties. But if they lose, if they have one person dissent, then they're not going to be able to move forward with some of the things they want to pass. And so, I know some of the things they've talked about have been a little bit controversial. We don't necessarily know how that's going to impact housing. It's really early. But, you know, we're still really in a wait-and-see.

Alexis: All right, well, I think we'll have more updates in our next episode then. If you don't have any other updates for us, I think that's all I have for you.

Jason: Yeah, that's great. Everyone, please take care. I know with the COVID issues that we're having right now…it's still continuing to spread…the economy is starting to open. But please, everyone, please take care.

Alexis: Stay safe, everyone. Thanks.

Jason: Bye.