Entries Tagged 'Mortgage Industry News' ↓
August 30th, 2010 — Mortgage Industry News
Mortgage markets improved last week despite a major mortgage bond sell-off Friday afternoon. Prior to the jump, conforming mortgage rates had cut new, all-time lows by Thursday, only to lose up to 0.250 percent on the last day of the week.
Meanwhile, the same type of news that drove rates lower Monday through Thursday also contributed to rates rising Friday — revised projections for the U.S. economy.
Early in the week, “bad” news piled on which, in turn, lowered expectations for the economy and pushed mortgage rates down:
• Existing Home Sales dropped 27% from June
• Single-Family New Home Sales dropped 12% from June
• Purchases of “big ticket” items plunged
Then, on Friday, two events revised the market’s expectations back higher:
• Q2 GDP was revised lower, but not as low as had been expected
• Fed Chairman Ben Bernanke said the economy will keep expanding through the end of the year and into 2011
When Chairman Bernanke talks, markets listen. His comments about the U.S. economy helped fuel that late-Friday surge in mortgage rates last week.
This week, the momentum could continue — depending on the data.
There’s a lot for markets to digest this week including key inflation figures from the government; home value data from Case-Shiller; Fed Minutes from the Federal Reserve; and, the always-important jobs report due Friday.
Last June, mortgage rates rose 1.125% in 10 days. Under the right circumstances, it could happen again.
August 23rd, 2010 — Mortgage Industry News
Mortgage markets stalled last week in back-and-forth trading as Wall Street grappled with weak housing data, falling builder confidence, and worsening jobs numbers nationwide.
Because markets were volatile, rate shopping was challenging.
Conforming mortgage rates did manage to make a new all-time low last Thursday but quickly gave up those gains. Most of Friday afternoon was spent in the red and, as a result, for the second straight week, mortgage rates failed to fall overall.
But, although last week’s action puts a damper on this summer’s mortgage rate rally, the Refi Boom is still going strong.
According to Freddie Mac, as compared to April 8 when mortgage rates touched their recent high-point, pricing is hugely improved across 3 popular loan products.
• 30-year fixed : Then, 5.21%; Now, 4.42%
• 15-year fixed : Then, 4.52%; Now, 3.90%
• 5-year ARM : Then, 4.25%; Now, 3.56%
As an example of potential savings, a homeowner in Texas with a $250,000 30-year fixed rate mortgage would save $96 per month at today’s rates as compared to April’s.
Over the life of a loan, that’s a savings of $34,560.
This week, it’s unlikely that the Refi Boom will meet its end, but that doesn’t mean you should wait for rates to fall further. Mortgage rates tend to change quickly and without notice, and should rates rise, you may find that you’ve missed the market bottom.
If today’s rates appeal to your finances and budget, consider locking something in and moving forward.
August 20th, 2010 — Mortgage Industry News
Southwest Funding, LP is pleased to name Melanie Brown (formerly of Allied Home Mortgage Capital Corp.) as Branch Manager of its newest office.
Melanie has more than 11 years in the mortgage industry and is looking forward to her continued service to the people of DeSoto, Hardee, and the surrounding counties of southwest Florida.
The branch office is located at 18 N. Polk Avenue, Arcadia, Florida in the historic downtown district and is open Monday thru Friday from 9:00 AM -5:00 PM.
Southwest Funding, based in Dallas, TX since 1993, is a full service mortgage banker offering all types of loans including FHA, VA, USDA, Conventional and Reverse mortgages. The company is opening new offices and hiring experienced mortgage professionals throughout the southwest.
Melanie Brown is known for her unique approach with helping people obtain financing. She doesn’t tell you “NO”, she tells you “How”. She believes in educating her customers so they know what to expect during the mortgage process. Melanie can be reached at 863-491-8888. Contact her today and see how she can help you achieve “The key to your home”.
August 20th, 2010 — Mortgage Industry News
Another week, another new low for conforming mortgage rates. In fact, this week marks the 9th time in a row it’s happened.
Mortgage rates are (again) at their lowest levels in history.
The data comes from the Freddie Mac, a government group and major loan securitizer for the U.S. mortgage market. Freddie Mac’s weekly survey is among the most widely-cited reports on mortgage rates and is the data used in home affordability models, among other statistics.
The 30-year fixed rate is averaging 4.42% nationally with an accompanying cost of 0.7 points. 1 point is equal to 1 percent of the loan size. This week’s reported rate is lower by 0.02 percent from last week, and lower by 0.70 percent from one year ago.
As mortgage rates continue to slide and touch new lows, it’s an excellent opportunity to see what Southwest Funding can do for you. Low rates won’t last forever.
August 16th, 2010 — Mortgage Industry News
Mortgage markets worsened last week, putting a pause on the mortgage rate rally that dates to mid-April. Mortgage rates rose last week and home affordability suffered.
The Refi Boom remains in full effect, but rates are not as dazzling as they were a week ago.
It’s somewhat strange that mortgage rates rose last week given the heavy dose of negative-bending news.
• The Federal Reserve noted that the economy “has slowed“
• New unemployment claims rose to a 6-month high
• Retail sales — excluding auto sales — rose less than expected
Mortgage rates often fall on such news, but last week, they rose. The biggest reason was weak demand on a new 30-year bond issuance from the government. In turn, that weakness spilled over into mortgage bonds, which pushed rates up.
This week, mortgage rates could rise or fall — it depends on how new data influences market sentiment.
• Monday : Home builder confidence survey
• Tuesday : Housing Starts and Building Permits; Producer Price Index
• Thursday : Jobless claims; 2 Fed members make speeches
Keep a close eye on the housing-related data early in the week. It’s widely believed that housing will lead the economy forward so a rebound in home builder confidence, or a jump in building permits, for example, should push rates even higher.
August 10th, 2010 — Mortgage Industry News
Today, in its first meeting in 6 weeks, the Federal Open Market Committee voted 9-to-1 to leave the Fed Funds Rate unchanged.
The Fed Fund Rate remains at a historical low, within a prescribed target range of 0.000-0.250 percent.
In its press release, the FOMC said that, since June, the pace of economic recovery “has slowed”. Household spending is increasing but remains restrained because of high levels of unemployment, falling home values, and restrictive credit.
Today’s statement shows less economic optimism as compared to the prior year’s worth of FOMC statements dating back to June 2009. The Fed is looking for growth to be “more modest in the near-term” than its previous expectations.
Weaknesses aside, the Fed highlighted strengths in the economy, too:
1. Growth is ongoing on a national level
2. Inflation levels remain exceedingly low
3. Business spending is rising
As expected, the Fed re-affirmed its plan to hold the Fed Funds Rate near zero percent “for an extended period”.
There were no surprises in the Fed’s statement so, as a result, the mortgage market’s reaction to the release has been neutral. Mortgage rates are unchanged this afternoon.
The FOMC’s next meeting is scheduled for September 21, 2010.
August 2nd, 2010 — Mortgage Industry News
Mortgage markets improved last week, pushing mortgage rates lower for the 6th time in seven weeks.
Since April, mortgage rates have been on a downward path, spurring refinances in most markets and sparking the start of a Refi Boom.
Last week, 3 key stories played a role in falling rates:
1. Demand was strong for U.S. government debt
2. Emerging concerns of a Japan-style deflation in the U.S.
3. Personal Spending since late-2007 was shown to be less than previously thought
Of the three, it’s the measured drop in Personal Spending for which rate shoppers and home buyers should watch. Drops in spending slow down the economy which, in turn, tends to pull mortgage rates lower.
Long-term, deflation could be a drag on rates, too. For now, though, it’s just a conversation among academics and economists.
This week, mortgage rates could move up or down — a lot hinges on the results on July’s Non-Farm Payrolls report.
More commonly called “the jobs report”, Non-Farm Payrolls hits the wires Friday at 8:30 AM ET. Markets are expecting a 75,000 net loss of jobs last month. If the actual number is higher, mortgage rates should rise. If the actual number is lower, mortgage rates should fall.
With the jobs numbers not due until Friday morning, expect choppy trading through Thursday’s market close. There’s a handful of economic data set for release including Personal Consumption Expenditures (Tuesday), Pending Home Sales (Tuesday) and Jobless Claims (Thursday). Each has the potential to move mortgage rates.
July 19th, 2010 — Mortgage Industry News
Mortgage markets improved for the 5th straight week last week as consumer confidence waned and inflation data tamed. Investors ignored the news that 19 of 23 reporting S&P 500 companies beat their respective earnings estimates and sold off on stocks.
There’s concern about a potential economic slowdown for the months ahead and it may be well-founded.
Despite an improving jobs situation and booming retail sales, households are less optimistic about the future and so is the Federal Reserve. In its post-meeting minutes released last week, the Fed revised its U.S. growth estimates downward for 2010 and 2011.
For rate shoppers, this is excellent news.
Because of the weakness, conforming mortgage rates fell again last week, extending the current rally in rates to 16 weeks. Mortgage rates are lower than at any time in measured history.
This week, data will be housing market-heavy and mortgage rates could rise or fall.
• Monday : National Association of Home Builders Index
• Tuesday : Building Permits and Housing Starts
• Thursday : Existing Home Sales
Strength in any, or all three, of these housing-related reports should push mortgage rates higher on higher hopes for the economy. Weakness, on the other hand, should have the opposite effect.
Overall, though, mortgage markets are trending better. Momentum is in effect and refinance activity is soaring. That said, it doesn’t mean that rates won’t rise — they could absolutely. It just takes a change in market sentiment. And that could happen quickly.
Mortgage rates are artificially low right now so even the slightest jolt could cause them to spike. It would be similar to what happened in June 2009 when rates rose 1.125% in just 10 days’ time.
There’s very little room for rates to fall further but a lot of room for rates to rise. Make sure you’re on the right side of that bet.
July 12th, 2010 — Mortgage Industry News
Mortgage markets improved again last week — if only barely — throughout a holiday-shortened week devoid of “major” data and market conviction.
Up-and-down trading characterized the week which ended with mortgage rates slightly lower versus the week prior.
Mortgage rates have fallen in 4 consecutive weeks and are on an extended rally that dates back to mid-April.
This week, however, data returns and rates could reverse. Especially with inflation numbers are in play.
Inflation is the enemy of mortgage rates.
Inflation is bad for mortgage rates because mortgage rates based on the price of mortgage-backed bonds. When inflation pressures mount, the demand for mortgage-backed bonds wanes and that pushes bond prices down which, in turn, pushed bond yields (i.e. rates) up.
There’s three pieces of inflation-related news this week.
The first inflation-related story is the Federal Reserve’s Wednesday release of the minutes from its last meeting. Now, when the Fed adjourned June 23, it said “underlying inflation has trended lower“. However, there was more to the conversation that what the FOMC released in its post-meeting statement.
Markets will be looking for clues.
Then, Thursday, the Producer Price Index is released. The Producer Price Index is a measure of business operating costs. When PPI is increasing, it means that “doing business” is more expensive — an inflationary situation. It’s inflationary because higher business costs are often absorbed by consumers in the form of higher prices for goods and services.
A rising PPI is usually bad for mortgage rates.
And lastly, Friday, the Consumer Price Index is released. The CPI measures the average American’s “cost of living”. Like PPI, when the Consumer Price Index is rising, mortgage rates tend to follow.
Other releases of import this week include Retail Sales and two consumer confidence surveys.
Last week, mortgage rates again made new all-time lows. Mortgage rates can stay low for a long time, but they can’t stay low forever. Lock your rate while you can.
July 6th, 2010 — Mortgage Industry News
Mortgage markets improved last week as economic data revealed a slowing U.S. economy.
Major stock indices fell to 2010 lows in response to a weak jobs report among other data points, forcing worldwide investors into the relative safety of U.S. government-backed bonds. This category includes mortgage-backed bonds and the extra demand helped to drop rates.
Once again, mortgage rates improved and Freddie Mac is reporting new all-time lows on three popular, conforming loan products:
• The 30-year fixed rate mortgage
• The 15-year fixed rate mortgage
• The 5-year adjustable rate mortgage
Low rates mean low payments and you can’t know your options until you ask.
This week, mortgage rates may move slowly. There’s very little data set for release because markets were closed Monday in observance of Independence Day, and because the second calendar week of a month is traditionally data-slow.
Tuesday, a consumer confidence study is published; Thursday, jobless claims plus consumer credit levels hit; and, Friday, we’ll see wholesale inventories. That’s about it. None of these reports are particularly important but, in aggregate, the numbers can show whether the economy is expanding or contracting.
In general, evidence of an expanding economy should cause mortgage rates to rise. In a contracting economy, rates are likely to fall.
Once mortgage rates start to reverse higher, they’re expected to reverse quickly.
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