|
When a consumer calls me for mortgage rates, 90% of the time they’re looking for a 30 year fixed mortgage. I can almost guess immediately what mortgage the customer is going to ask for before they finish their sentence. Let me start off by saying that I do not have anything against 30 year fixed loans. They have [...] I just finished watching Spencer Rascoff’s interview on Bloomberg where he shared data with regard to mortgage rates and real estate values. LINK TO INTERVIEW HERE He felt that we won’t hit the floor for values until late 2010, but it varies by region. He gave an example, showing that Boston had hit it’s floor in early 2009 and is already [...] The two consecutive weeks, we’ve watched mortgage rates slowly work their way down after a nasty spike in rates last month. With weak economic data, signs of controlled inflation and talks of a new stimulus bill, investors have quietly moved more of their money in to Mortgage Backed Securities. The 5% Fannie Mae coupon improved 72 basis points this week slowly gaining back some of the losses we’ve taken over the past month. For the first time since “Black Wednesday,” I locked several 30 year fixed loans at 5% including some FHA with a slight buy-down. Let’s hope rates continue to drop through next week. I’ve posted a few blogs regarding how inflation relates to interest rates. I happened to come across a pretty good article that also covers this. ARTICLE LINK It’s pretty clear that investors do not have confidence of ANY position the bond markets take. When rates are too high, investors buy the bonds because they think their cheap, but follow the activity with selling the second bond pricing starts to rally. One consistent trend of bonds, if not all markets, is when you see a quick reversal of trends. It’s clear that bonds are unstable at the moment, but it does appear that Mortgage Backed Securities are starting to rally after 4 consecutive days of losses. This is common because investors will find the point they consider [...] Last week I had predicted we may see a spike in interest rates. Unfortunately, this became more true than I expected. We’ve lost over 200 basis points on the Fannie Mae 4% coupon since the opening day Thursday. We’re past any major news affecting rates and we’re currently just riding the trend wave. Over the last few weeks, we’ve seen 15 year fixed and adustable rate loans drop substantially. 15 year rates have dropped to the low 4% range and adjustable rate loans are now in the mid to high 3% range. Many of my clients ask me my opinion of where rates are going. The response I often give, which many of you have heard, is, “Forecasting interest rates is a little like forecasting the weather. If you want to know tomorrow’s forecast, it’s not too difficult. However, the farther out the forecast, the less likely it [...] |
 |
|
Copyright © 2010 Keane Loans - All Rights Reserved |
|