14 May Could this Recession Turn into a Depression?
It was reported this morning that another 2,980,000 filed for unemployment benefits in the last week. Although this was 189,000 fewer than the week prior, it has the potential to push the US economy into a depression. Without question, the economy will reach a recession. A depression is essentially a sustained and long term downturn in an economy. Given how deep the cuts have already been, we could see this economic downturn last a number of years.
Given the number of jobs the PPP loans saved, it is shocking to see the job loss tally as high as it now is. With many companies planning layoffs after their PPP loans turn into grants, the coming months are projected to be rough for the labor market.
Home buyers with conventional mortgage loans will now see a nice improvement to interest rate options, with a new program we rolled out yesterday. Depending upon the amount of closing costs a home buyer wants to pay, the rate for a conforming purchase will in many cases be between 2.5% – 3%. This should help increase the amount of home an average buyer will qualify for. Hopefully, the lower monthly payments will entice more potential home buyers to step into the market and purchase. With the strong summer season ahead, we are doing all we can to help strengthen the market.
We will maintain a locking bias.