Author: Editor - Finance Top Stories

Mortgage Rates Nominally Higher, But Still Near Long-Term Lows

Mortgage rates rose today, but by a small enough amount that it shouldn’t crush too many hopes and dreams.  For all intents and purposes, rates remain in line with the lowest levels since November 2016.  Any movement in recent weeks has been limited to “upfront costs” as opposed to interest rates themselves. That has the potential to be a bit confusing, so I like to break it down from time to time.  Now is one of those times!   There are upfront costs tied to your interest rate.  They can be positive or negative.  Markets tend not to move enough for rates to change to the next .125% higher or lower (the typical gap between adjacent rate offerings).  The upfront costs allow a sort of “fine-tuning” of the overall cost of financing.  The longer the mortgage is retained, the smaller the impact the upfront costs will have on the overall cost of financing. When markets aren’t moving much, our observations of mortgage rate changes are strictly limited to these upfront costs, but we extrapolate them into rate format in order to keep things tangible.  In other words, if rates could move in 0.01% increments, that would be the extent of today’s weakness. 3.875% remains the most prevalently-quoted conventional 30yr fixed rate for top tier scenarios, although quite a few lenders remain at 4.00%.   Today’s upfront costs for 3.875% would be slightly...

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Mortgage Rates Steady at 2017 Lows

Mortgage rates held steady to start the new week.  This keeps them in line with the best levels since November 2016.  There were no interesting developments in financial markets or in terms of economic data today.  Most news coverage was focused on the solar eclipse.  It’s a good thing the eclipse happened, because it’s not entirely clear what financial media outlets could have possibly discussed otherwise. But again, with rates at the lowest levels of the year, “boring” and “sideways” are only terms that inconvenience someone trying to write about market movements whereas they’re a relative boon to consumers who are buying a new home or refinancing an existing mortgage.   3.875% remains the most prevalently-quoted conventional 30yr fixed rate for top tier scenarios, although quite a few lenders remain at 4.00%.   Loan Originator Perspective Small early gains were eclipsed by mid-day as our holding pattern continued.  I’m guessing market participation was limited today, know mine was.  Wish I had more sage suggestions, but when markets tread water for weeks, it’s challenging.  –Ted Rood, Senior Originator With no major economic reports on this Solar Eclipse Monday we continue to follow the pattern from last week, the slow drift to the bottom of the range leaving us with rates at or near post-election lows.  Rates have been consolidating at this key pivot in treasuries.  I’m still advising clients to be locked if...

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More 2017 Lows for Rates; More Trump Drama

Mortgage rates moved lower again.  Drama surrounding the Trump administration was also present.  But this time around, the political theater wasn’t responsible for the move lower in rates.  In fact, it resulted in multiple lenders adjusting rate sheets higher in the middle of the day.  Fortunately, rates fell enough in the morning that the net result was still positive.  The average lender is at new lows for 2017 (lowest since just after the November 2016 election, in fact).   3.875% is now the most prevalently-quoted conventional 30yr fixed rate for top tier scenarios, although quite a few lenders remain at 4.00%.   Next week brings the normally-hotly-anticipated Jackson Hole symposium, but with monetary policy for both the Fed and the European Central Bank essentially an open book of late, market participants aren’t expecting too much drama.  Loan Originator Perspective Yet another day of limited movement in bond markets today, despite more rumors of administration discord/departures. I’m not locking most loans until 30 days before closing. This range will break, someday, but it doesn’t look like that day is today. Happy Friday! –Ted Rood, Senior Originator After starting the day in positive territory, bonds are starting to leak into the close. They apparently do not like the waters below the 2.21 level on the 10 year treasury note. Even though I am not a fan of locking on Friday, my clients are...

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Trump Administration Drama Pushing Rates Even Lower

Mortgage rates fell yesterday in response to a tweet about Trump disbanding his councils of CEOs.  Twitter was in play again today.  This time around it was Gary Cohn, Trump’s economic advisor.  Rather, it was rumors of Cohn’s departure that sent financial markets into a tail-spin.  Terror attacks in Spain may have played a supporting role.  The net effect was heavy losses for stocks and solid gains for bonds.  When bonds improve, rates fall. Mortgage lenders continue to be slow to pass along the gains in bond markets in general, but they’re certainly passing them along.  Multiple lenders issued positive reprices in the afternoon as bond markets rallied.  Conventional 30yr fixed rates are increasingly being quoted at 3.875% as opposed to 4.0% on top tier scenarios.  On average, rates are the lowest since November 2016–something we’ve been able to say for the 2nd straight day, and several times over the past few weeks. Loan Originator Perspective Another day of tepid action in bond markets, as Fed members cited sub-par growth and inflation concerns.  My pricing improved marginally, but stayed within recent ranges.  Sitting at these levels certainly isn’t bad for borrowers and lenders, but can lull both into false senses of security.  If you’re happy with your pricing, and within 30 days of closing, consider locking and sleeping soundly than tossing over a minimal potential pricing improvement. –Ted Rood, Senior Originator...

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