Mortgage Rates News: Week of July 6, 2010

Mortgage Rates News: Week of July 6, 2010

July 6, 2010

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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