City Creek Mortgage News

The Bureau of Labor Statistics’ (BLS) Jobs Report came in way stronger than expected. While the market was looking for 205,000 new job creations, the actual figure came in at a whopping 313,000. In addition, the prior two month’s reports were revised higher by a combined 54,000.  In the history of job reports, I don’t remember a single one where the market was this far off of reality. Economists seem to be out of touch with the strength of the labor force.  We will have to see if this trend continues.


Although mortgage bonds experienced an adverse impact to the report, it was tamed by the Average Hourly Earnings number only increasing by 0.1%, which lowered the year over year average from a 2.9% rate to 2.6%. Since wage based inflation is among the greatest concerns of bond investors, this was good news.


Another critical part of the report was the Unemployment Rate, which held steady at 4.1%. Since the labor force grew by a greater number than the rate of new jobs created, this held constant. Also good news for mortgage interest rates.


The stock market is dramatically higher today, as stock investors celebrate the job report. Stocks are once again within striking distance of all-time high levels. The fears that investors felt in February seem to be behind us.


Once again….  we will maintain a locking bias.

At City Creek Mortgage, it’s our mission to get you the best mortgage rate as you search for your home. Especially for first-time buyers looking to become homeowners, this is a vital consideration.

Why should you want to become a homeowner? There are numerous benefits, from the independence and space you’ll find to the kinds of areas you might be able to live in. But perhaps the biggest benefit, and one many folks often overlook or become confused on, is the financial side – two recent studies helped illustrate the net worth and ROI gap between homeowners and renters. Let’s look at the results, and what they might mean for you.

The Stats

As of December 2013, the US Census Bureau reports the median net worth of homeowners at $199,557. This is in comparison to the net worth of renting households, which is just $2,208 on average, or nearly 100 times less. In addition, the recovery of the economy during the years in between makes it likely that the gap is even larger today.

Another study from the Federal Reserve effectively confirmed these findings, noting that the gap in homeowner and renter net wealth rose from a difference of $182,000 to over $220,000 during the period between 2010 and 2013.

How to Interpret Them

It’s important to remember that in many situations, this disparity was due to more than just a housing situation. Many homeowners are in that situation because they’re more well-off to begin with, allowing them to invest in a home.

However, this is something of a self-fulfilling prophecy in some ways. Homeowners enter into debt just like renters, but they do so in an investment – renters do not. Since home prices continue to rise faster than interest on a basic home loan, homeowners are building equity over time and can often make a significant profit on the back end. This is without even considering all the tax advantages that come into play, none of which are available to renters.

To learn more about why you should favor homeownership over renting if you have the choice, or to learn about any of our other mortgage loan services, speak to the pros at City Creek Mortgage today.

The year 2018 is here, and now that we’re all done celebrating the turn of the calendar, it’s time to get down to business. A new calendar year is a good time for those in the mortgage loan world to take a look at some of the trends that took place over the last year, and to forecast how these might carry over into the following year.

At City Creek Mortgage, our experts are ahead of the curve here. Let’s look at a few expected trends for 2018 based on expert opinions in the field.

Rising Home Sales

In recent years, homes have become tougher to find. But 2018 could signal the reversal of that trend, with a growth in inventory anticipated around the fall period. With this, resales of existing homes should rise to a small degree. Experts forecast the southern part of the country to have the most growth, with up to 6 percent growth in some markets.

Rising Mortgage Rates

Mortgage rates were at 4.07 percent in 2017, and they could rise as high as 4.7 percent in 2018 if projections hold. Do remember, though, that mortgage rate is one of the toughest areas to predict – many experts predicted the same kind of rise in 2017, and that never ended up happening. So while a rise of this magnitude is possible, it’s no certainty.

Lowering Home Prices

After several years of insane appreciation, home price increases are expected to slow in 2018. Growth is expected at just 4 percent, in comparison to over 6 percent in each of the last two years. Experts expect home construction to rise significantly, with single-family housing expected to jump by 8 percent.

Equity and Lines of Credit Increasing

Homeowners gain equity as home values rise, and lenders and banks are expecting more borrowing against equity to take place in 2018. Roughly 1.6 million homeowners will receive new home equity lines of credit this year, a 16 percent increase from 2017. By 2022, over 10 million homeowners could have these lines of credit – double the number of the previous five-year segment.

To learn more about changing mortgage trends in 2018 or any of our other services, speak to the pros at City Creek Mortgage today.

With the Tax Reform bill now signed into law, many homeowners will find that this important piece of legislation restricts
some of the benefits they have enjoyed from owning a home. Although the impact will mainly hit the higher end of the
housing market, there are some potential tax deductions that could impact the way they structure their mortgages.
Let’s look at what the changes could mean for current and future homeowners:
Lower Mortgage Interest Deduction
In the past, homeowners have been able to deduct interest on up to $1,000,000 of mortgage obligation.
For homes purchased now and in the future, this limit will be reduced to $750,000. For those who already
owned their homes at the time of the Tax Reform bill passing, they will be grandfathered into the prior
amount allowed.
Impact: Since this portion of the bill only impacts high valued homes, we anticipate this will have little impact on the
overall housing market. People looking at mortgage balances of over $750,000 will likely still purchase homes,
even if they lose the deduction on up to $250,000 of the mortgage balance.
Loss of Tax Benefit for Home Equity Loans
With property values moving higher, there has been a rush of people taking out home equity loans to make
use of their increased available equity. Under old tax rules, a homeowner was able to deduct interest on
up to $100,000 of the balance of an equity loan. This tax loophole has been eliminated.
Impact: We all remember back in 2008 and earlier when homeowners were taking out home equity loans to
purchase boats, make improvements, take vacations or just spoil themselves at the mall. This created major
improvements to the amount of money flowing through the U.S. economy. With values reaching new highs, this
trend has started once again.With the tax advantage no longer available, it will likely deter some people from
taking out home equity loans. Therefore, we could see a negative economic impact. People with home equity
loans will likely consider rolling them into a primary mortgage, which may create more tax advantage and
interest rate stability long term.
Limit on Property Tax Deduction
One reason that has prevented some homeowners from protesting their property taxes is that they have
received 100% of the property tax payments as a write-off from their taxable income. Under the new
law, the property tax and state income tax write-offs have been limited to a combined $10,000 reduction
from taxable income.
Impact: In Utah, the state income tax rate is 5%. This is a flat tax, so there are no itemizing deductions on
a Utah state tax return. If a homeowner has property tax of $2,500, they would be allowed to have $150,000
in gross income and still receive the full tax savings of owning a home. Therefore, the impact will mainly be
for higher income earners.
Given that the average Utah state income tax collection is less than $1,000 per year, most residents will not
be impacted.

With home prices moving a great deal higher in recent years, some are worried that we are now on the verge of another housing bubble. Although this could be true, it certainly doesn’t appear likely in the near term. In fact, housing prices are projected to continue to grow over the coming years. However, many millennials are using this fear as rationale to continue to live with their parents or rent.

Real estate used as a primary residence has proven over time to be a wise investment, regardless of the timing of the purchase. Although some built up significant equity by purchasing when prices were at their lows during the recent housing crisis, even those who bought at the peak of the market in 2007 should once again be in a strong position of equity.

Homeownership is one of the greatest determining factors that contribute to wealth accumulation. In 2015, the average net worth of a homeowner was $195,400, compared to just $5,400 for a renter. Not only is a homeowner able to better weather a financial storm by borrowing against accumulated equity, homeowners are also able to reach a point where they no longer must make a mortgage payment once the home is paid off. Further, with rents rising as rapidly as they have in recent years, a homeowner who purchased their home years ago is likely paying far less than a renter who is leasing a similar priced home. In addition, the homeowner will receive a tax break that isn’t available to those who rent.

Although inching higher, the current home-ownership rate is well below where it should be. We need to see a bigger push for millennial home buyers to help ensure a strong economy in the decades to come. If they fail to buy at a reasonable age, they could be missing out on a significant opportunity.

Our team secretly came together for this photo while we were out of town and put it up on billboards for our return.
Mike and I started this amazing journey when Austin Taylor Roberts was still in a baby carrier sleeping under my desk.CCM_Turns_19_Years_txt
It has been the most rewarding, challenging, painful, scary, and exciting thing we’ve ever done…and we wouldn’t change it for anything.
Every day we get to work with our friends who believe what we believe and share our mission to be the most Trusted, Respected & Loved mortgage company in Utah….and soon beyond 🙂
I could not be more proud of this team, of the company we have all built and to all of you who honor us with the opportunity to serve.
Here’s to another amazing 19 years!

– Tobi Roberts


The Hidden Truth about Interest Rates

I recently made the decision to care less about being liked by people in the mortgage industry and more about transparency surrounding what I believe. For the sake of this article, I’ll focus on how much a mortgage loan truly costs an average consumer at most mortgage companies vs. what it costs at City Creek Mortgage. Further, I’ll dive into where I see the future of this industry as well as the people who work within it.

First, I want to make clear this is not a dig at my competitors. I believe most mortgage lenders are wonderful people who work for great companies. Just because I have fundamental differences in beliefs about how much companies and people in my industry should earn, doesn’t make my competitors wrong.

The $ Behind a Mortgage

Few consumers realize how much money is made in the process of a mortgage. For many well-known local mortgage companies, a $300,000 mortgage loan generates $12,000 of revenue. What consumers should understand is that this “standard” cost of originating a loan is substantially higher than the actual cost of doing so. The result is needlessly higher interest rates and closing costs for the consumer. Although “it’s just the way things are done,” I believe once people understand what is happening, this practice will come to an end.

In total transparency, a $300,000 mortgage loan closed at City Creek Mortgage will generate up to $6,000 in revenue on average. Although still a healthy income, it is significantly below what most companies make on the same loan. By choosing to make less money on each loan, we save our borrowers in both interest rate and closing costs compared to many of our competitors. Plain and simple, that’s the truth.

As I consider the future of the mortgage industry, I see what many in the industry don’t want to face. Some may disagree with my assessment. I see a time in the coming years where a computer will be able to replace most of the work done by mortgage loan originators. I will explain my thoughts below.

The Impact of Technology

Technology is making the mortgage process significantly easier, faster & more affordable. We are already at the stage where technology can automatically retrieve taxes, bank statements or pay stubs. Since this is most of the supporting documentation required for a loan, the effort required by the consumer and loan originator is decreasing. Further, many loans no longer require a physical appraisal. Once again, expediting the loan process. When combined with digital signing and instant loan approval, it’s not difficult for one to perceive a day when a mortgage loan originator is only needed on more complicated loans. It could even be that a human is needed on only 25% of all loans closed.

A Mortgage Loan Originator’s Income

In truth, the individual mortgage loan originator is usually able to set their own compensation levels. I know many that get paid 2% of each loan they close. This is in addition to what their respective company makes on each loan. For this to work, mortgage companies roll that super high commission into the interest rate they charge borrowers.

So for a $300,000 loan, not only does the company make money, but the loan officer gets $6,000 in commission. For that same $300,000 loan at City Creek Mortgage, $6,000 is the total revenue. No additional charges, or rolling commission into the interest rate like other companies. We use $6,000 to pay 30 staff members, and all our overhead. That’s why (in other companies) you can often get a lower rate by walking through an office and asking individual mortgage loan originators what their level of compensation is. Once you find the lowest plan, you can choose that mortgage loan originator and be offered lower rates and fees. Or you could do it…

The Right Way

You may be wondering how it is possible for City Creek Mortgage to make half of what our competition make on each loan. It is simple. We have a volume-based model. We have to do more loans, because we make less on each loan. We provide our loan officers with the stability of a salary and since they don’t do any marketing themselves, they can do substantially more loans per month than the typical loan originator.

I believe most mortgage loan originators who work for companies eventually will be paid a salary. An individual loan originator will no longer be able to make hundreds of thousands of dollars a year at the expense of the consumer for closing a handful of loans each month. The current system, where borrowers are paying a luxury tax each month for 30 years for overcompensated loan officers is flawed. Further, the real estate agents who claim to want the best for their clients are often the ones feeding the business to these highly compensated mortgage loan originators. It’s just wrong. Consumers shouldn’t be footing the bill for extravagant lifestyles of over-compensated mortgage loan originators. Trust me, it will change.

And that, my friends, is my explanation as to why our rates at City Creek Mortgage are so much lower than our competitors.

My wife and I are considered by many to have a hot, sexy marriage. I must admit, that’s a badge I wear proudly. It seems rare to find couples who met in high school 28 years ago who are still passionately in love. I often get asked what are secret is. Although I’m far from an expert I have created a theory that has greatly helped me. and I’d like to share it with you.

Healing Conflict – According to Mike

Conflicts are one of the greatest relational challenges we face in life. Although they can be painful, they can also provide opportunities for personal growth. In fact, some of my greatest growth stemmed from the hardest trials I have experienced.

If you truly analyze the root of personal conflicts you encounter with another person, you will find that many of them stem from a misalignment of how each person is proportionately valuing two mutually exclusive alternatives. For example, in a marriage one person may value their work more than having dinner as a family at 5:30 pm each night. It isn’t that either party is right or wrong, it’s simply that they are not valuing the two options the same.

Whether it’s intimacy, time together, spending money, or how active a lifestyle they live, all couples have areas in their lives where they’re not in alignment. In such cases, there are three options that will avoid continual conflict:

1. One or both parties genuinely alter their values to come into alignment with the other person in a true and healthy way.

2. You live according to your alignment and your spouse modifies his/her behavior to “artificially” align with your values. In this case, you may be happy and feel that all is good, but your spouse will live in conflict.

3. You adjust your behavior to artificially align with the values of your spouse. In this case, you feel pain and continue to live out of alignment with what you believe.

Clearly the first option is the only healthy solution. In many cases, issues that are creating conflict can be mutually aligned with a discussion and a real look in to what each person is valuing in a situation.

In the case of the above example, the person working while the rest of the family is eating dinner together may not be what they truly want in life. They may just be in a competitive job that requires they work beyond 5:00 even though they truly would like to be at home sharing time with their family over dinner. Or maybe they do value working long hours to provide for their family. …Understanding the WHY behind the behavior is the first step in coming together.

As for #s 2 and 3, these are far more painful and have the greatest chance of creating division and distance in a relationship. From what I have witnessed, it seems there are five possible outcomes:

1. The conflict eventually ends the relationship.

2. One person continues to live out of alignment with their values, in a state of conflict, while the other person goes on; possibly not even realizing they are creating pain for their spouse. This is the case when you hear of someone who thought they had a wonderful marriage and then received surprise divorce papers. They didn’t realize that their spouse was existing in conflict that eventually caused them to snap.

3. Each person compromises and they establish an agreed upon solution that is comfortable to both parties.

4. The person living out of alignment adjusts their values in a healthy way to become in alignment with the other.

5. The person setting the course re-aligns their values.

The reality is that each of us need to question what we are truly valuing in life, and determine which values are healthy and which ones are not. For example, if I was to have a girlfriend on the side, it would be an indication that I might be valuing attention from another above my marriage commitment. This would clearly be an unhealthy value that would not serve me or my family well. I would then get help to realign my values in a healthier way.

The key takeaways that I hope you learn from this are:

1. Talk openly when you are out of alignment with your spouse’s behavior.

2. Never make your spouse wrong when they verbalize that they are out of alignment with you. It isn’t a matter or right or wrong. It’s simply that current values aren’t in alignment.

3. Seek to create a level of safety in your relationship where both parties feel comfortable discussing areas in which they feel conflict.

Having a fulfilling relationship for almost 30 years takes work, hard work. Of course, we work on different issues today than we did back then. It’s a never-ending commitment.

I hope you find value in my theory. It has certainly helped contribute to the success of my relationship. If I get a good response from this, maybe one day I’ll share my fool-proof recipe for a passionate sex life! 😊



Warren Buffett’s famous quote “Be fearful when others are greedy, be greedy when others are fearful,” seems to be applicable to today’s stock market environment. With the US stock market recently setting new all-time highs, confidence in the market has reached a peak not seen since 2005. This strong sentiment may be reaching a point of “irrational exuberance.”

History shows that a contrarian outcome is often the result of an extraordinarily high level of faith that the market will continue to improve. A look back on previous market corrections shows that confidence generally peaks just prior to the downturn. Given the current political, economic and global uncertainty, it seems that circumstances may be ripe for a correction later in 2017.

Any attempt to foresee the direction of a market should be taken with a grain of salt. There are strong arguments to suggest the stock market will continue its climb higher well past 2018. The level of confidence however, is a concern.

The ladies of City Creek Mortgage joined The JR Way to deliver an extra special experience to the families living at The YMCA. We had a blast pampering the mom’s with hair, makeup, nail and massage services. For the kids we had stuffed stockings, games, cookies, tattoos and tons of other fun stuff. Everyone had a great time and we will be making this an annual event.

If you want to learn more about awesome giving opportunities like this, you can follow our page at Lending a Hand with City Creek Mortgage on Facebook.