Filed under: Daily Mortgage News | Tags: Conventional Loan Rates, CU Mortgage Division Olympia Washington Mortgage Lender, First Mortgage Rate Lock Advice, Mortgage Loans Olympia Washington, Olympia Home Loan Rates, Olympia WA Interest Rates, Olympia Washington Mortgage Lender, The Mortgage Dude, William Tuning - Olympia
The bond market opened a little better early this morning with slightly weaker stock indexes. The 10 yr note at 1.91% and MBS prices +4/32 (.12 bp) at 8:30. March personal income at 8:30 up 0.4% a little better than forecasts, personal spending though at +0.3% a little softer than thought. On the report treasuries and mortgages didn’t show any reaction. US stock indexes early this morning trading lower, following the markets in Europe.
The DJIA opened -10, NASDAQ -7, S&P -2; the 10 yr note +4/32 1.92% -1 bp and mortgage prices 3/32 (.09 bp) frm Friday’s close.
At 9:45 the April Chicago purchasing mgrs. index, expected at 60.0 frm 62.2 in March; it fell to 56.2. The three components; new orders 57.4 frm 63.3, prices pd at 68.6 frm 70.1 and employment at 58.7 frm 56.3. Overall a weaker report adding to concerns of slowing economy. The weakness is primarily due to inventory levels declining but respondents to the survey also were saying they were looking for a strong summer. The DJIA slipped a little on the report but mortgage prices and the 10 yr note didn’t show much initial reaction.
Treasuries going for their biggest monthly gain since September as slowing U.S. economic growth and concern Europe’s debt crisis is worsening, increased demand for the relative safety of US treasuries. Ten-year notes are slightly higher for a third day with Spain going into its second recession since 2009 and economists said U.S. reports this week will show growth in manufacturing and services slowed. Not only Spain, the UK is in a double-dip recession since the 1970s as its longest peacetime slump for a century persists; UK GDP declined in the last two quarters. The increasingly serious question for Europe is whether the massive austerity cuts demanded have failed to gain support and are for a number of countries unachievable, leading to further deterioration of economies and dragging other global economies down with it. In the US economists predict Labor Department data this week will indicate U.S. hiring increased in April, though not enough to reduce the jobless rate. Consumer spending climbed in March, but a little weaker than estimates. The concern we have for the 10 yr is that it still has not shown the ability to hold under 1.90% on rallies going back to October.
This week may point to a slowdown in manufacturing, services and construction. A gauge of factory activity (ISM manufacturing) will fall to 53.0 from 53.4 in March, according to the median forecasts. An index of services (ISM services sector), the largest part of the economy, will decline to 54.1 from 56.0, while a construction measure will also fall, economists said in separate surveys. A reading above 50 indicates expansion. We won’t put much confidence on the estimates that recently have been more dart tossing than accurate assessments. This week is more about employment than any other report; however the data this weeks has a number of key points.
The 10 yr note is approaching 1.90%, since last October the 10 yr has fallen below it on three occasions but in each case the note was unable to hold under it. Not sure what will occur now but history does have an impact; a sustained decline under 1.90% would embolden traders to push rates lower, the next technical resistance under 1.90% at 1.80%.
Filed under: Daily Mortgage News, Mortgage Guidelines | Tags: First Mortgage Loans, Mortgage Loans Olympia Washington
This morning, FHFA announced their enhancements to the HARP refinancing program. Operational details of the plan are to be released on November 15. Only loans that were purchased or guaranteed by Fannie Mae or Freddie Mac on or before May 31, 2009 and have a current LTV over 80% are eligible. In addition, the loan must be current, no late payments in the last six months and no more than one late in the last 12 months.There are no restrictions on who may refinance these loans. Program guidelines include:
- No limit on LTV, if new loan is a fixed rate loan (current LTV must be above 80%)
- Loans previously refinanced under HARP not allowed
- Certain agency fees will be waived if new loan is a shorter term loan
- Appraisals not required where Agency AVM is available
- Certain originator Reps and Warrants will be waived
Filed under: Daily Mortgage News | Tags: Credit Union Mortgage Division, CU Mortgage Division, CU Mortgage Division Lacey Washington, CU Mortgage Division Olympia Washington Mortgage Lender, Home Loans Olympia Washington, Olympia Home Loan Lender, Olympia Washington Real Estate Lender, Tumwater Washington Mortgage Lender, William Tuning - Olympia
Yesterday, Fannie Mae released their National Housing Surveyfor the second quarter of 2011. They survey the American public on a multitude of questions concerning today’s housing market. Each quarter, we like to pull out some of the findings we deem most interesting. Here they are for the most recent report:
Most Important Reasons to Buy a Home
When we talk about homeownership today, it seems that the financial aspects always jump to the front of the discussion. However, the study shows that the four major reasons a person buys a home have nothing to do with money. The top four reasons, in order, are:
- It means having a good place to raise children and provide them with a good education
- You have a physical structure where you and your family feel safe
- It allows you to have more space for your family
- It gives you control of what you do with your living space (renovations and updates)
The Home as an Investment
Though most people purchase a home for non-financial reasons, everyone realizes there is a money component to homeownership. Here is what they said on this issue:
- 65% of the general population (and 67% of homeowners) believe that homeownership is a ‘safe’ investment.
- 56% believe that homeownership has more potential as an investment than any other traditional asset class.
- 69% think that now is a good time to buy a home (this number has increased in each of the last two quarters)
Rent vs. Buy
We are always interested in the difference people see in renting vs. owning.
- 63% of renters have aspirations to someday own their own home
- 72% of renters think that owning is superior to renting
- 95% of homeowners see homeownership as a positive experience (4% see it as a negative experience) while 82% of renters see renting as a positive experience (17% see it as a negative experience)
- 96% of homeowners live in a single family residence while 46% of renters live in a multi-unit building
Bottom Line
Even in difficult times, Americans still realize the value of homeownership.
Original Article located here.
Filed under: Daily Mortgage Interest Rate Update, Daily Mortgage News, Interest Rates | Tags: Credit Union Mortgage Division, cu mortgage, CU Mortgage Division Lacey Washington, CU Mortgage Division Olympia Washington Mortgage Lender, Home Loans Olympia Washington, Mortgage Interest Rates, Mortgage Loans Olympia Washington, Olympia WA Interest Rates, Olympia Washington Mortgage Lender, Olympia Washington Mortgage Rates, The Mortgage Dude, Tumwater Washington Mortgage Lender, Washington, William Tuning - Olympia
Monday’s bond market has opened in positive territory following early selling in
the stock markets. The stock markets are reacting to renewed concerns about the
European financial crisis, pushing the Dow down 148 points and the Nasdaq lower
by 49 points. Bonds have benefited as investors shift funds into them to escape
the volatility in stocks. The bond market is currently up 10/32, which should
improve this morning’s mortgage rates by approximately .125 – .250 of a discount
point over Friday’s morning pricing. Part of this morning’s improvement is a
result of strength late Friday, so if your lender revised lower Friday
afternoon, you may see only a minuscule improvement in this morning’s
rates.
There is no relevant economic data being posted today, so if we
see an intra-day change in mortgage rates it will likely be a result of a swing
in the major stock indexes. If stocks remain close to current levels, bond
prices and mortgage rates should follow suit. However, if stocks rebound from
current level, recovering a good portion of their early losses, we could see a
decline in bond prices and an upward revision to mortgage rates later today.
However, further losses in the major indexes could create a slight improvement
in mortgage rates.
The rest of the week brings us the release of five
important economic reports in addition to two Treasury auctions that may
influence rates. Only two of the five reports are considered to be of fairly
high importance to the bond market and mortgage pricing. The remaining reports
are considered to be of moderate or low importance and will likely not heavily
influence mortgage rates.
The first data of the week will be April’s New
Home Sales data late tomorrow morning. This report gives us a measurement of
housing sector strength and future mortgage credit demand. However, it is
actually the least important release of the week and probably will not have much
of an impact on mortgage pricing because it tracks only approximately 15% of all
home sales. It is expected to show little change in sales from March’s level,
meaning the new home portion of the housing sector was flat last
month.
Overall, I think we have a fairly busy week ahead of us. The big
report of the week is Wednesday’s Durable Goods Orders. If Thursday’s GDP
revision varies greatly from forecasts, it can also lead to sizable changes in
rates. There are also a couple of Treasury auctions that are worth noting. The
5-year Note sale is Wednesday and the 7-year Note auction will be held Thursday.
Both may influence bond trading and possibly mortgage rates if they are met with
an exceptional demand or if there is lackluster interest from investors.
The bond market will close early Friday afternoon ahead of next Monday’s
Memorial Day holiday. With all this, there is a pretty good possibility of
seeing mortgage rates change several times this week- especially if there is
more volatility in the stock markets. Accordingly, please proceed extremely
cautiously if still floating an interest rate.
If I were considering
financing/refinancing a home, I would…. Lock if my closing was taking place
within 7 days… Lock if my closing was taking place between 8 and 20 days…
Lock if my closing was taking place between 21 and 60 days… Float if my
closing was taking place over 60 days from now… This is only my opinion of
what I would do if I were financing a home. It is only an opinion and cannot be
guaranteed to be in the best interest of all/any other borrowers.
©Mortgage Commentary 2011
Filed under: Daily Mortgage News, Interest Rates | Tags: Conventional Loan Rates, Credit Union Mortgage Division, CU Mortgage Division Olympia Washington, CU Mortgage Division Olympia Washington Mortgage Lender, First Mortgage Rate Lock Advice, Home Loans Olympia Washington, Lacey WA Mortgage Lender, Mortgage Interest Rates, Mortgage Loans Olympia Washington, Olympia Home Loan Lender, Olympia WA Interest Rates, Olympia Washington Mortgage Lender, Olympia Washington Mortgage Rates, The Mortgage Dude, William Tuning - Olympia, Washington
Thursday’s bond market has opened in negative territory following early stock strength and unfavorable economic news. The stock markets are showing sizable gains with the Dow up 156 points and the Nasdaq up 38 points. The bond market is currently down 17/32, which will likely push this morning’s mortgage rates higher by approximately .375 – .500 of a discount point, partly due to weakness late yesterday.
Revised productivity numbers for the 4th Quarter were posted early this morning. They showed that worker productivity rose at an annual rate of 2.6% last quarter, matching the preliminary estimate that was released last month. Analysts were expecting to see a downward revision to the index, making this a bit of good news for the bond market. Unfortunately, it does not carry enough significance to the markets for it to offset this morning’s bond selling and increases to mortgage pricing.
Helping to fuel this morning’s earl y stock gains and bond selling is last week’s unemployment numbers. Labor Department said early this morning that 368,000 new claims for unemployment benefits were filed last week. This was a noticeable decline from the previous week, particularly because an increase in claims was expected, and was the lowest number of new filings since May 2008. It is worth noting that this was the third decline in the past four weeks. These numbers help support those who feel the labor market is gaining traction and will turn the corner in the near future. Whether or not this is accurate remains to be seen, but since this news comes a day ahead of February’s monthly figures, the bond market is preparing for unfavorable news.
There are two reports scheduled for release tomorrow, with one being much more important to the markets and mortgage rates than the other. The Labor Department will be in the spotlight when they release February’s Employment report at 8:30 AM ET. Some of the important portions of the report will give us the unemployment rate, number of new jobs added or lost and the average hourly earnings reading. The best combination for the bond market and mortgage rates would be an increase in the unemployment rate, a large drop in payrolls and little or no increase in earnings. Current forecasts are calling for 0.1% increase in the unemployment rate to 9.1% and approximately 183,000 jobs added during the month. Weaker than expected readings would be great news for the bond market and should lead to lower mortgage rates tomorrow. However, stronger than expected numbers will likely fuel more bond selling and noticeable increases to mortgage rates.
January’s Factory Orders will also be released tomorrow, but during late morning hours. It will give us measurement of manufacturing sector strength. This data is similar to last week’s Durable Goods, except this report covers orders for both durable and non-durable go ods. Current forecasts are calling for an increase in new orders of approximately 2.1%. A smaller than expected rise would be good news for the bond market, but the Employment report carries much more importance than this data.
If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days… Lock if my closing was taking place between 8 and 20 days… Lock if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.
Filed under: Daily Mortgage Interest Rate Update, Daily Mortgage News, Interest Rates | Tags: Conventional Loan Rates, Credit Union Mortgage Division, CU Mortgage Division Olympia Washington, CU Mortgage Division Olympia Washington Mortgage Lender, First Mortgage Rate Lock Advice, Home Loans Olympia Washington, Mortgage Loans Olympia Washington, Olympia Home Loan Lender, Olympia WA Interest Rates, Olympia Washington Mortgage Rates, William Tuning - Olympia, Washington
Thursday’s bond market has opened well in positive territory even though this morning’s key inflation data gave us stronger than expected results. The stock markets are showing minor losses with the Dow down 23 points and the Nasdaq down 3 points. The bond market is currently up 15/32, which should improve this morning’s mortgage rates by approximately .250 of a discount point.
The Labor Department gave us this morning’s major news with the release of January’s Consumer Price Index (CPI). They announced increase of 0.4% in the overall reading and 0.2% in the core data. Both readings were slightly higher than forecasts, meaning that inflationary pressures at the consumer level of the economy were a little stronger than many had thought. That is bad news for the bond market and mortgage rates because rising inflation erodes the value of a bond’s future fixed interest payments and leads to bond prices falling to offset the loss i n value. This is why when inflation is a concern, bond prices suffer and mortgage rates tend to rise.
They also gave us last week’s unemployment figures that showed new claims for unemployment benefits rose above 400,000. The 410,000 new claims were slightly higher than what analysts had expected, but more importantly they did not decline again. This is the second time that they have fallen below the 400,000 benchmark, only to immediately move back above. Therefore, we can consider this data favorable for bonds and mortgage rates.
January’s Leading Economic Indicators (LEI) were posted late this morning, showing a 0.1% increase that fell short of expectations. This indicates that the report is predicting flat economic growth during the next three to six months, making it good news for bonds and mortgage pricing. However, this is not the catalyst to this morning’s bond rally because the CPI is certainly more important to the marke ts than this report is.
It appears that the CPI results did not concern the markets, to the benefit of mortgage shoppers. Today’s bond rally isn’t a result of comments during Fed Chairman Bernanke’s testimony either since he said little about the economy and monetary policy. It is quite possible that the lack of movement in stocks has helped draw funds into bonds. I would not be surprised at all to see stocks move lower from current levels and bond prices move higher. Today’s bond buying may be the beginning of that trend.
There is no relevant economic data scheduled for release tomorrow, so look for the stock markets to help drive bond prices. Yesterday’s release of the FOMC minutes did reveal that Fed members were more optimistic about economic growth, going as far as revising their forecasts for economic growth this year. That could mean that they may be starting to at least consider changes in monetary policy some time later this year. However, they still remained quite concerned about the labor market and the unemployment rate. After the minutes were released, we did see bond prices weaken a little, but nothing drastic happened to mortgage pricing.
If I were considering financing/refinancing a home, I would…. Float if my closing was taking place within 7 days… Float if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.
©Mortgage Commentary 2011
Filed under: Daily Mortgage Interest Rate Update, Daily Mortgage News, Interest Rates | Tags: Conventional Loan Rates, Credit Union Mortgage Division, CU Mortgage Division Olympia Washington Mortgage Lender, First Mortgage Rate Lock Advice, Interest Rates, Mortgage Interest Rates, Olympia Home Loan Rates, Olympia Washington Mortgage Lender
CU Mortgage Division Daily Rate Lock Advisory: We watch the bond market every day, helping clients take advantage of market movements and wholesaler price discrepancies, saving THOUSANDS OF DOLLARS. Call or email for a free consultation or visit www.cumortgagedivision.com .
Thursday’s bond market has opened in negative territory following the release of much stronger than expected economic data. The stock markets have had little reaction to the news with the Dow up 9 points and the Nasdaq down 2 points. The bond market is currently down 9/32, but we will still see a noticeable improvement in this morning’s mortgage rates due to strength late yesterday. If comparing to yesterday’s morning rates, we should see an improvement of approximately .375 of a discount point.
The Labor Department said early this morning that 388,000 new claims for unemployment benefits were filed last week. This was well below forecasts of 416,000 and the lowest total since July 2008. At first appearance, the headline number could be concerning for the bond market and good news for stocks. The size of the drop and the number of new claims hints at a strengthening employment sector. In fact, the number of weekly new claims has risen only once in the past 6 weeks.
That said, the markets have not had a significant reaction to the data for a couple of reasons. First and primarily, the data covers only a single week’s worth of new claims. Another portion of the report showed that the number of continuing claims for benefits (claims that are not new) rose during the week when analysts were expecting them to remain flat. Also, the reason for the drop in new claims could be the Christmas Holiday last week where state offices were closed at least one of the five days. So, while the headline number of 388,000 does draw attention, it comes from a report that does not carry significant importance because of the short term it covers and were statistics from a holiday-shortened week.
We saw bonds rally late in the day yesterday, partly as a result of a 7-year Note auction that went surprisingly well. Several of the measurements we use to gauge the success of the auctions showed fai rly strong investor demand, especially if comparing to Tuesday’s 5-year Note sale. After the results of yesterday’s sale were posted, bonds moved higher causing some lenders to revise mortgage rates lower.
There is no relevant economic data scheduled for release tomorrow. It is the last trading day of the year, so we may see a little volatility as investors look to finalize their year-end holdings. We may actually see some of that take place this afternoon, so don’t be surprised to see movement in the markets this afternoon. But there is not much concern that we will see sizable changes to mortgage rates. Keep in mind that the bond market will close at 2:00 PM ET tomorrow and will reopen Monday for regular hours. The stock markets will not be recognizing the holiday with regular trading hours both tomorrow and Monday.
If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days … Lock if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.
©Mortgage Commentary 2010
