Mortgage ratesmanaged to holdin line with 2017's lowest levels for a 2nd day, even though underlying bond markets suggested a move higher. That means the prices of mortgage-backed-securities (MBS--the bonds that dictate mortgage rates) were lower. When MBS prices are lower, it means investors are paying lenders less to buy mortgages. Lenders then raise rates to entice investor demand.
If the nuts and bolts underlying the mortgage rate market suggested a move higher, why were rates able to hold their ground? The first part of this answer is that we're not talking about huge amounts of movement in bond markets. US Treasuries did experience a fair amount of weakness, but MBS held their ground better by comparison. ...(read more)Forward this article via email:Send a copy of this story to someone you know that may want to read it.
Mortgage ratesunexpectedly fellto new 7-month lows today, following bond market gains in the overnight hours (Asian and European trading sessions). Interest rates are driven by bond markets. The latter is part of an ecosystem of "risk" associated with the entire financial market. At times, most of that broader market will collectively move toward or away from risk. When investors are shedding risk, bonds (and thus, mortgage rates) tend to benefit. Adding to the bigger-picture move was a headline regarding China's intention to buy more US bonds. Higher demand for bonds results in higher prices (which move inversely from rates)...(read more)Forward this article via email:Send a copy of this story to someone you know that may want to read it.
Mortgage rateswere modestly highertoday after hitting the lowest levels since early November at the end of last week. Along with mid-April, this is the second time rates have been in this territory in more than 7 months. Most prospective borrowers will see very little--if any difference between Friday's rate quotes and today's. Certainly, the NOTE rate itself will be unchanged, with any deterioration limited to the upfront costs that impact the EFFECTIVE rate (similar to APR).
With rates being driven by financial markets and with investors generally on edge ahead of Thursday's congressional testimony from former FBI Director Comey, it makes sense to Friday's momentum to ebb to some extent. Thursday should remain a focal point for volatility this week. Remember, volatility (and thus, the risk of floating vs locking) goes both ways. If Thursday ends up being a watershed moment in US political history--as some suggest--rates could easily continue to new lows for 2017. If, on the other hand, the testimony is anticlimactic or casts Trump in a favorable light, rates could rise very quickly....(read more)Forward this article via email:Send a copy of this story to someone you know that may want to read it.
With rates being driven by financial markets and with investors generally on edge ahead of Thursday's congressional testimony from former FBI Director Comey, it makes sense to Friday's momentum to ebb to some extent. Thursday should remain a focal point for volatility this week. Remember, volatility (and thus, the risk of floating vs locking) goes both ways. If Thursday ends up being a watershed moment in US political history--as some suggest--rates could easily continue to new lows for 2017. If, on the other hand, the testimony is anticlimactic or casts Trump in a favorable light, rates could rise very quickly....(read more)Forward this article via email:Send a copy of this story to someone you know that may want to read it.
Mortgage ratesmoved convincingly lowertoday following weaker-than-expected employment data from the Labor Department. The big "jobs report" showed only 138k new nonfarm payrolls (the report's headline job creation metric) in May, and a negatively revised 174k in April (down from 211k). March was revised lower as well, painting a suddenly gloomier picture relative to the strong, stable job growth reported since roughly 2011.
It's not that the current numbers are worse than they were during some of the rough patches over the last 6 years, just that we're not seeing as much resilience. Payroll growth has now come in under 250k for 10 straight months--something that hasn't happened since 2012 (but at least in 2012, the broader trend was positive as opposed to potentially reversing)....(read more)Forward this article via email:Send a copy of this story to someone you know that may want to read it.
It's not that the current numbers are worse than they were during some of the rough patches over the last 6 years, just that we're not seeing as much resilience. Payroll growth has now come in under 250k for 10 straight months--something that hasn't happened since 2012 (but at least in 2012, the broader trend was positive as opposed to potentially reversing)....(read more)Forward this article via email:Send a copy of this story to someone you know that may want to read it.
Mortgage ratesgave backyesterday's gains this morning following a stronger-than-expected employment report from ADP. While this is not the week's biggest jobs report, investors view it as one of several early indicators of the official Employment Situation (the big jobs report that comes out tomorrow morning). In general, stronger economic data (i.e. more job growth) tends to push rates higher and vice versa.
In the bigger picture, today's move higher in rates will scarcely be detectable for most borrowers. In nearly every case, today's rate quote would be the same as yesterday's with the possible exception of slightly higher upfront costs today. When it comes to "note rates" (the actual interest rate applied to your mortgage balance, without regard for the upfront costs), we're still sideways near the best levels of the year....(read more)Forward this article via email:Send a copy of this story to someone you know that may want to read it.
In the bigger picture, today's move higher in rates will scarcely be detectable for most borrowers. In nearly every case, today's rate quote would be the same as yesterday's with the possible exception of slightly higher upfront costs today. When it comes to "note rates" (the actual interest rate applied to your mortgage balance, without regard for the upfront costs), we're still sideways near the best levels of the year....(read more)Forward this article via email:Send a copy of this story to someone you know that may want to read it.