New Listing! 1257 Drake Circle, SLO


Professionally and extensively renovated! 4 bedrooms and 2 baths, large 2 car
garage, dining area off kitchen, bright living room and rear yard. New 30 year
roof, gutters, exterior stucco repairs, exterior paint, front dual pane windows,
garage door, front landscaping, kitchen cabinets & counter tops, bathroom
vanities, sinks, fixtures & counter tops, stall shower in master bath,
interior doors, water heater, refinished ceilings, interior paint and carpet
throughout, with much more! Enjoy this as a sweet home or ready-to-go income

New Listing! 277 Craig Way, SLO


Enjoy the sweeping views of San Luis Mountain out of the back of this charming 2
bedroom, 1 bath home with approx. 1064 square feet. Upgrades include remodel of
the kitchen, some interior plumbing, and interior painting. Wood stove in living
room. Bay window in master bedroom. Located close to schools and shopping on
large lot with room to expand or play. Long drive-way with RV parking and good
size detached 2-car garage!

Mortgage Rates Move Off Lows; Pre Qualify to Prepare for Next Dip

On Wednesday, October 15, mortgage rates took an abrupt pitch downward. Today, October 27, rates have moved up and erased much of the discount.

The hefty price dip came after a perfect confluence of events. Might we see such a move again? It is definitely possible, and it would open up another opportunity for existing owners to refinance and potential owners to increase their purchasing power. Give us a call at 805.543.LOAN to set up a pre qualification appointment so that you can quickly take advantage of the next window.

(Note: mortgage interest rates are still very close to all-time lows. If you have mortgage insurance, have a rate above 5.0%, or aren’t sure if you can afford to purchase a home, give us a call at 805.543.LOAN to learn about the possible savings. The call is confidential and honest, and it won’t cost you a dime.)


Recapping the rate dip

Two weeks ago, several major stock indexes (Dow Jones, S&P 500) almost had their first proper downward “correction” (a drop of at least 10%) in nearly three years. Investors pulled back from stocks due to an assortment of worries: global economic slowdown, ebola, geopolitical issues, and the Federal Reserve’s negatively revised expectations for the U.S. economy. The volatile environment is a perfect one for mortgage rates. We cover all of this and more in last week’s column.

By the time the sell-off occurred, mortgage rates were already on their way down. The bond markets were closed on Monday, October 13, so lenders had been holding off making downward revisions from the previous week.

On October 15, as market volatility cranked into high gear, lenders finally priced in all of the changes from the previous week. All of a sudden, mortgage rates were at their lowest level in over 18 months. Mortgage rate prices were about 1.5 points lower than they were three to four weeks prior. A “point” is 1% of the total loan amount, so for a loan of $400,000, a “1.5 point drop” would be $6,000 in cash.

The low-rate window persisted for a little over a week.


Where we stand today

Today – October 27 – mortgage rates have moved up off this unexpected dip. Last week, the S&P 500 jumped 4.1% for its best weekly gain of 2014. The Dow Jones Industrial Average rose 2.6% over the week, and Nasdaq rose 5.3%.

When investors turn to stocks, money flows away from the “safe” bond market. Lower demand for bonds puts upward pressure on mortgage  rates. (The 10-year Treasury yield is a quick and dirty way to track expected rate movement: a higher yield suggests higher mortgage rates, and vice versa). Click here to learn more about when – and why – mortgage interest rates move.

Rates could drop again if anything sets off the market into “sell” mode. Recent stock dips aside, we have still not seen a downward correction. Corrections come about once a year, historically.

Homeowners: to take advantage of the hefty savings offered by such a low rate “window” make sure to get pre qualified, so that your loan officer can lock in a rate when the time is right.


Last Week’s Data

  • Existing home sales rose more than expected in September, up to a pace of 5.17 million for the year. Overall, sales have slowed in 2014 by 1.7 percent year-over-year.
  • The national existing home median sales price of $209,700 is 5.6% higher year-over-year.
  • Jobless claims continue to perform well. The October 11 week offered up 266,000 total claims, a 14-year low, and the October 18 week’s 283,000 claims kept the 4-week average of 281,000 at a 14-year low.
  • New home sales are right around their fastest pace since 2008. The median sales price dropped 9.7% as sellers cut prices, which could account for the improvement in sales pace.


Loan Program Update

If you haven’t yet, be sure to check out the CCL Workforce Housing Loan Program. Median and low income borrowers are eligible to receive what could be a steep discount on their home loan.

This program is particularly effective for middle-credit borrowers who want to offer a down payment under 20% because it puts a cap on fees charged for such “riskier” loans. Read more here.


Central Coast Lending is a California mortgage broker and direct lender based on the Central Coast of California in San Luis Obispo County. Call us today at 805.543.LOAN or email us here to set up a free pre qualification. We are The Mortgage Experts: ask us anything!

About   ||   Mortgage FAQ   ||   Market Update Blog   ||   Radio Show   ||   Contact

Volatile Stock Market Helps Mortgage Rates Plummet

Last Wednesday, the CBOE Volatility Index, a highly regarded measure of market volatility, reached its highest reading since November of 2011. Several times over the past week, investors sold off stocks en masse. Stocks would then veer higher the following day, only to dip back over some piece of unsettling news.

You might recall: late-2011 was a notably unstable time due to the “sovereign debt crisis” in Europe. Greece and Italy, for example, appeared ready to default on their debt obligations. Investors worried that sovereign default in the Eurozone would have harmful repercussions for the global economy.

Here we are in 2014, and global instability is again impacting U.S. stock markets:

  • The European economy may be slipping back into recession. German industrial activity has dropped. The Greek stock market has plummeted.
  • The geopolitical situation remains a mess, with unstable situations in Russia, Ukraine, and the Middle East (Syria, ISIS, etc).
  • China’s economy appears to be slowing. What repercussions will this have for global demand?

With all of the uncertainty, is there cause for concern?

U.S. retail sales came dipped in September, but other data paints the picture of an economy that is in a steady cycle of growth. U.S. employment news continues to be positive: new jobless claims fell to their lowest level since 2000 last week. Construction activity increased in September.

Stock indexes hadn’t had a “correction” (defined as a dip of 10% or more) in three years, whereas corrections typically happen about once per year. Uncertainty might have given investors the nudge they needed to sell off into this “correction”. Put simply, the stock pullback was overdue. The volatility component comes in as investors attempt to buy at the bottom of the market and find undervalued purchases.


Mortgage Rates

Volatility and uncertainty put downward pressure on mortgage rates.

Over the past three weeks, interest rate pricing has moved down by between 1 and 1.75 points. A “point” signifies one “percent” of the total loan amount. By dollar amount, an interest rate that costs 1 “point” on a loan of $400,000 would translate to $4,000.

Like anything you would purchase, mortgage rates have prices. The lower interest rates are “more expensive”, and buyers are charged more “points” to obtain them. To avoid the expense, buyers can accept a higher interest rate for a lower charge. The higher rates will often offer a “rebate” that the borrower can use to cover closing costs.

Is it better to accept short-term pain and pay “points” for a lower rate? Or accept a higher rate to help cover closing costs? If the owners intend on staying in the home for a long time, the lower interest rate could result in significant long-term savings.

Give us a call at 805.543.LOAN and we will break down the numbers and help you find the best solution for your unique situation.


The Savings Window

To give you an example of just how friendly such a significant price improvement can be to your wallet, consider the following scenario:

Joe Buyer is taking out a $400,000 home loan and elects to use the standard “Conventional” home loan with a 30-year fixed term. Joe Buyer wants to find the lowest possible rate to keep his monthly mortgage payments at a low, manageable level.

On September 24, the 4.000% 30-year fixed rate (4.162% APR) is expensive, and would have cost Joe Buyer 1.75% of the total loan amount: $7,000.

Nearly one month later (October 20), Joe Buyer can obtain the 4.000% 30-year fixed rate (4.015% APR) at a cost of zero points. The 1.75% price improvement offers a savings of $7,000!

The low rate environment offers an opportunity for buyers to increase their purchasing power and afford more home.

Existing owners also have an opportunity to refinance their mortgage into a lower rate. Any mortgage holder with mortgage insurance should also consider refinance to eliminate the costly MI payment.

Give us a call at 805.543.LOAN to discuss the possibilities! No commitment, no cost: just honest advice from the Mortgage Experts. 805.543.LOAN.

SLO County Artists hold Open Studios this Weekend

Fall is Open Studios time every October throughout San Luis Obispo County.  For the visual arts lovers, it is a chance to seek out the work of artists from Paso to Nipomo and along the Coast, North to Cambria.  Artists open their homes or studios and most are on site to display and discuss their work. All mediums of painting seem to be represented plus metal work, pottery, jewelry, woodworking/turning, sculpture, glasswork, weaving/wearable art… name it……….even surfboard art!  This FREE event is open to all again this coming weekend 10/18 and 10/19 from 10 am to 5 pm.  For more information and a full schedule go to

Just Listed! 636 Creston Road, Paso Robles


This great home represents affordable housing and all 1st time buyers and
investors should not miss this one! When current owners purchased in 2004 they
re-stucco the exterior, installed new dual pane windows, new roof, new wall
heater, remodeled the kitchen AND bathroom and put in a beautiful new concrete
driveway and parking area. This home is a real sweet deal waiting for a new
owner. Front & rear yards are on auto sprinkler system and front yard has
been re-landscaped to be drought tolerant. There’s a shaded patio in rear yard
to enjoy warm afternoons. The driveway is spacious and all new concrete and the
garage provides storage as well as covered parking for the car.

New Listing! 6680 Navarette Ave., Atascadero


Bring your extended family to this Westside Atascadero home featuring 4 bedrooms (2 are master suites w/bath) and 3 full baths. Beautiful cathedral, open beamed ceilings, laminate flooring throughout the living areas & kitchen. Great, spacious kitchen with abundant storage in attractive cabinets. Brick Fireplace in living room. 2 car garage with automatic door opener. Nicely landscaped in a quiet, treed setting & location.



Stock Market Struggles With Volatility; Will Mortgage Rates Drop?

On Tuesday, October 7, the Dow Jones Industrial Average dipped 274 points. The following day, it posted its largest jump of the year: 274 points. Next, the Dow retreated 334 points.

Talk about mixed messages.

All major U.S. stock indexes fell at least 2% last week, with the Nasdaq down 4%. The Dow is now even on the year. Despite Wednesday’s rally, it was the worst week for North American markets since 2012.

The volatility feels somewhat reminiscent to what we saw in 2011, when concern about the U.S. government shutdown, the “fiscal cliff”, and European debt issues dominated the headlines. This time around, however, the U.S. government is functioning (as best it can, at any rate) and U.S. employment data is strong.

The trouble, once gain, comes from abroad. Last week, an economic report showed that German industrial activity and exports had plummeted to 2009 levels. Meanwhile political unrest in Ukraine / Russia and the Middle East has people nervous.

So what can we expect moving forward?

After 2011’s bout of volatility, stocks went on what would essentially become a three-year winning streak (despite some struggles in 2012). Growth through 2013 was consistent, and in 2014, the S&P 500, Dow, and Nasdaq consistently improved on all-time highs.

In a recent column, Financial Post writer John Shmuel interviewed Jason Mann, co-founder and portfolio manager at EdgeHell Partners. Mann points out that the normal markets average a technical correction – a decline of 10% – at least once per year. The S&P has now gone over 1,000 days without a 10% decline.

After the run of success, we may be in the midst of the long-awaited correction. On the bright side, U.S. economic data has been consistently positive strong, which will set a strong foundation for growth after any hypothetical correction runs its course.

For more on market “corrections” read financial planner and Blakeslee & Blakeslee Vice President David Cryden’s take here.


Mortgage Rates

30-year Fixed (Freddie Mac) copyMortgage rates have dropped over the past week. Volatility in the stock market tends to benefit mortgage rates, as investors seek safe places – like the U.S. bond market – to put their money. Periods of high demand for bonds often result in lower mortgage rates.

But will lenders offer lower prices? Widely-followed mortgage market commentator Rob Chrisman pointed out that a bond market rally might not translate to better rates for mortgage holders.

“Rate improvements are muted by loan level price adjustments, buy ups and buy downs, historically high gfees and mortgage insurance costs, and compliance expenses – all of course passed on to new borrowers.”

The benefit of our business model at Central Coast Lending, is that as bankers AND brokers, we are able to shop around for the best rate pricing. As brokers we can shop between 40+ banks to find the best bargain. Give us a call at 805.543.LOAN for a free, honest assessment of our financial situation and your mortgage requirements, and we will help point you in the right direction.


Central Coast Lending is a California mortgage broker and direct lender based on the Central Coast of California in San Luis Obispo County. Call us today at 805.543.LOAN or email us here to set up a free pre qualification. We are The Mortgage Experts: ask us anything!

About   ||   Mortgage FAQ   ||   Market Update Blog   ||   Radio Show   ||   Contact