Mortgage News
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Mortgage Rates Mostly Unchanged After Treasury Auction
Posted To: Mortgage Rate Watch When economic data is thin the stock market tends to have a larger impact on the direction of mortgage rates. The session began with stocks moving lower yesterday. With no data on the economic calendar to reverse the market's direction, the bond market was able to rally all day (higher bond prices = lower bond yields). This allowed most lenders to reprice for the better. Like yesterday, the economic economic was quiet today. Two events influenced the marketplace... The Department of Treasury auctioned $21 billion 10-year notes today. Before the auction, the bond market made room for new debt supply by letting Treasury prices fall (cheapen). This pushed benchmark yields higher and led MBS prices lower. The issue must have gotten cheap enough because auction demand was strong. This led to a modest...( read more) 
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USDA Rural Development System Upgrade Complete. Now Processing Conditional Commitments
Posted To: MND NewsWire In March we learned that USDA Rural Housing funds were expected to run dry by the end of April . A month later, even though the legislation intended to provide the funding had not passed, USDA began issuing commitments for new loans, but there was a caveat: Loan approvals would be "subject to the availability of funds and Congressional authority to charge a 3.5 percent guarantee fee for purchase loans and a 2.25 percent guarantee fee for refinance loans." Finally, on July 29 Congress passed HR 4899 to reestablish the program as one that would no longer be subject to the annual whims of Federal funding but self-sustaining through a 3.5 percent guarantee fee paid by the borrower. Four weeks passed after the Congress did their job and appropriated unlimited funding for the USDA Rural Housing Program...( read more) 
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Jeff's Blog -
National Mortgage News
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Written by Jeff
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Monday, 03 March 2008 16:58 |
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Last week I asked if "the trend was your friend" wondering if the recent back-up in mortgage rates was the end of a longer term trend or a short head fake by the markets. Maybe head fake was the right answer. Mortgage Bonds rallied on Thursday and Friday last week on very weak economic news and mortgage rates improved by as much as 1/4%. We are now in the low 6% range for 30 year fixed rate mortgages after seeing highs of 6.50% early last week. We'll probably see another increase in average mortgage rates reported by Freddie Mac this week, but that's because of the timing of their survey. This week should hold the key as we get the Employment Report on Friday. If the report is weak, mortgages rates will drop further and we could get below 6% again very quickly. If you are thinking about re-financing your mortgage, watch the news this week and download my free report - "When is it Time to Refinance". |
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Jeff's Blog -
National Mortgage News
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Written by Jeff
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Sunday, 24 February 2008 13:43 |
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Is the Trend your Friend? After declining steadily since the last week in December, mortgage rates have reversed course over the past 3 weeks. Freddie Mac announced the average rate for conforming ($417,000 and under) 30 year fixed rate mortgages was 6.04% with 0.6 discount points for the week ended February 21st. Rates have been dropping since last summer as part of a larger overall trend that was briefly interrupted in December. That interruption was short-lived and rates began falling much faster in January and early February when economic reports and market sentiment led investors to believe the economy was extremely weak. Rates bottomed out in late January averaging 5.48% with 0.4 discount points. The question becomes, is the ½% run-up in the 30 year rate the beginning of a reversal in the longer term trend of declining rates, or is it a head fake? This coming week may tell the story. Remember, as I’ve said before, it’s a battle between investors viewing the economy as weak and those more concerned with inflation. Although the inflation hawks have been in command the past couple of weeks, this week’s economic reports might reverse that trend. Any weakness in the reports, especially the GNP data, will lead to lower mortgage rates. The gross domestic product data Thursday will be the most important event this week. Producer price index, consumer confidence, durable goods, new home sales, income, outlays, and sentiment data also have the real potential to cause mortgage interest rate volatility. So is the longer term trend your friend – we might get a better answer this week. |
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Jeff's Blog -
Jeff's Blog
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Written by Jeff
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Thursday, 21 February 2008 13:39 |
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I love when you see or hear the media proclaim “the average mortgage rate” is [pick a number]. Why? Because they seldom, if ever, explain where the average comes from and how many discount and/or origination points it includes. There’s also the little issue of timing. “Average rates” come from three (3) main sources – the Mortgage Bankers Association (MBA), the Federal Home Loan Mortgage Corporation (Freddie Mac), and Bank Rate Monitor. A trade group, a government sponsored enterprise (GSE), and a for profit business respectively. It would be helpful if you knew from which source the average came. I use the Freddie Mac number on my website – www.sjbaxter.com – in the interests of full disclosure. Here are the latest averages and reporting dates: | Source | Week Ended | Reporting Date | Rate | Points | | Mortgage Bankers | February 15 | February 20 | 6.09% | 1.1 | | Bank Rate Monitor | February 20 | February 20 | 6.37% | 0.4 | | Freddie Mac | February 21 | February 21 | 6.04% | 0.6 |
I like the Freddie Mac number because they survey 125 lenders each week and include a mix of lenders that closely matches the market. The Bank Rate survey only includes the top 10 lenders in the top 10 markets. Given today’s concentrated market, the same lenders are surveyed in each market. The Mortgage Banker’s survey lags the market by a good week, but covers a larger potion of the overall mortgage market. Here are the announcements this week from each survey. For comparison, our comparable 30 year fixed rate is 6.25% and 0 points or 6.00% and 1 point today. |
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Read more: Mortgage Rates, Averages and the Media
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Jeff's Blog -
National Mortgage News
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Written by Jeff
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Sunday, 17 February 2008 21:08 |
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Valentine's Day just passed and I fell in love with ARMs again after a 5-6 month hiatus. I used love the appeal of the ARM but she was replaced by the fixed rate mortgage which had all the appeal of my mother-in-law. Stable, boring, but not very sexy. All this was the product of a flat yield curve. Studying my rate sheet the other day, I was smitten. She hit me like a bombshell, holding a great bottle of wine and the perfect smile. This time, she promises to stay put for a ten-year period. Frankly, ten years is plenty of time for me to outlast a few bumps in the economic road; it's a relationship worth having. I'm talking about the spread between a 30 year, fixed rate loan and an ARM with a ten-year fixed period. The 30 year mortgage is around 6.0% while the ten-year fixed rate ARM is offered at 5.5%. Ten years is a LONG time, regardless of the economy, so I'm recommending that over the fixed rate loan. |
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Jeff's Blog -
National Mortgage News
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Written by Jeff
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Saturday, 16 February 2008 21:15 |
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We all know the stock market has been volatile in the past few months, and now we are seeing an uptick in mortgage rates driven primarily by activity in the market for what are called Mortgage Backed Securities (MBS). These are also commonly called mortgage bonds. As with all bonds, when prices fall interest rates (yields) rise. Mortgage bond prices fell last week pushing mortgage interest rates significantly higher. Stock strength the beginning of the week hurt mortgage bonds. Stronger than expected retail sales also shocked the market. The weakness was compounded as investor concerns about exposure to mortgage bond risk grew. Fed Chairman Bernanke expressed concerns about economic growth but his remarks did little to help mortgage bonds. |
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Read more: Mortgage Rates have increased over the past week
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September 7, 2010 (8)
