Weekly Mortgage Market Commentary 8/30/2009

The week that was A little better in the rate markets; the 10 yr note yield fell 12 BPs and mortgages down about 8 BPs. Choppy trade once again characterized the action last week. Treasury had little trouble selling $109B of notes while new home sales increased 9.6 % in July. July durable goods orders increased 4.9%, the biggest monthly increase since July 2007, consumer confidence increased, and weekly jobless claims declined. Nice week but the stock market barley held on. Freddie Mac weekly results of its Primary Mortgage Market Survey® reported 30-year fixed-rate mortgage (FRM) averaged 5.14 percent with an average 0.7 point for the week ending August 27, 2009, up from last week when it averaged 5.12 percent. Last year at this time, the 30-year FRM averaged 6.40 percent. Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.67 percent this week, with an average 0.6 point, down from last week when it averaged 4.57 percent. A year ago, the 5-year ARM averaged 6.03 percent. (more…)

China to buy US Mortgages and what it means for you

CNN Money reported that China's $200 billion sovereign wealth fund, which suffered big paper losses on stakes in Morgan Stanley and Blackstone, is set to invest up to $2 billion in U.S. mortgages as it eyes a property market recovery. Under the Public-Private Investment Plan (PPIP) launched earlier this year, the U.S. government plans to seed a number of public-private investment funds that would combine taxpayer money with private capital to buy as much as $40 billion in toxic securities from banks. Compared with TALF, the new and smaller PPIP program focuses on…continue reading →

San Jose Weekly Mortgage Market Commentary 8/23/2009

The week that was Mortgage loan delinquency, borrowers 60 or more days past due, increased for the tenth straight quarter, hitting an all-time national average high of 5.81% for the second quarter of 2009, according to the latest data from TransUnion.com. This statistic is up 11.3% from the first quarter's 5.22% average. Sales of existing homes in July jumped at the fastest rate in 10 years. Sales of single-family homes increased 7.2% in July from a month earlier to a seasonally adjusted annual rate of 5.24 million units, the National Association of Realtors…continue reading →

San Jose Weekly Mortgage Market Commentary 8/16/2009

The week that was Continued market volatility; the mortgage market regained some losses from the week before as interest rate markets swung wildly from one economic report to the next. Freddie Mac Primary Mortgage Market Survey® for 30-year fixed-rate mortgage (FRM) averaged 5.29 percent with an average 0.7 point for the week ending August 13, 2009, up from last week when it averaged 5.22 percent. Last year at this time, the 30-year FRM averaged 6.52 percent. Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.75 percent this week, with an average 0.6 point, up…continue reading →

San Jose Weekly Mortgage Market Commentary 08/09/2009

The week that was Job losses were a lot less than expected; still 247K jobs lost with no real insight as the when it will finally flatten. The unemployment rate, expected to be up to. 9.7% fell to 9.4%, down 0.1% from June. Weekly jobless claims on Thursday fell by 38K to 550K filings for unemployment. Both series were double blows to the gut for the rate markets, and manna for the stock market. The week that will be The stock market is seen as a gorge that has to have some digestion,…continue reading →

San Jose Weekly Mortgage Market Commentary 08/02/2009

The week that was Freddie Mac's Primary Mortgage Market Survey® (PMMS®) for 30-year fixed-rate mortgage (FRM) averaged 5.25 percent with an average 0.7 point for the week ending July 30, 2009, upfrom last week when it averaged 5.20 percent. Last year at this time, the 30-year FRM averaged 6.52 percent. Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.75 percent this week, with an average 0.6 point, up slightly from last week when it averaged 4.74 percent. A year ago, the 5-year ARM averaged 6.07 percent. Note that these rates are for loan amount…continue reading →

San Jose Weekly Mortgage Market Commentary 07/26/2009

The week that was Mortgage Loan Limits Extended: The House Appropriations Committee has approved an extension of the $729,750 loan limits for Fannie Mae, Freddie Mac and the Federal Housing Administration (FHA) through September 2010. The committee also increased the lending and guarantee authority of FHA and Ginnie Mae, as requested by the Obama Administration. The Department of Housing and Urban Development appropriations bill authorizes FHA to insure $400B in single-family loans during fiscal year 2010, up from $315B in the current 2009 fiscal year, which ends Sept. 30. Mortgage Rates mostly unchanged:…continue reading →

San Jose Weekly Mortgage Market Commentary 7/19/2009

Starting today, I will be writing a weekly mortgage market commentary to take a quick look back on what happened last week and a preview of the coming week. Look out for this post every Sunday or Monday. The week that was: Freddie Mac released it's results of weekly Mortgage market survey on July 16th. The 30 year fixed rate mortgage rates averaged 5.14% with 0.7 points, down from last week when it averaged 5.20% Last year at this time, the 30-year FRM averaged 6.26 percent. Five-year Treasury-indexed hybrid adjustable-rate mortgage rates (ARMs) averaged 4.83 percent this week, with an average 0.7 point, up slightly from last week when it averaged 4.82 percent. A year ago, the 5-year ARM averaged 5.80 percent. Note that this is for conforming loan amounts below $417,000. (more…)

Low mortgage rates gone already for Bay Area?

And why you should rush to buy Low mortgage rates are Going..Going...Gone for Bay Area!! FNMA-30 4.5% coupon went down again today - by a whopping 100 bips. Over last couple of weeks mortgage backed securities have been in a free fall, pushing the mortgage rates up - substantially. According to Freddie Mac 30-year fixed-rate mortgage (FRM) averaged 5.29 percent with an average 0.7 point for the week ending June 4, 2009, up from last week when it averaged 4.91 percent. 15 year fixed rate mortgages and 5 year adjustable rate mortgages moved up too. Note that these averages are for conforming loans under $417,000. The rates for conforming jumbos (loan amounts upto $729,750) and jumbos are higher than these averages. Yields on long-term Treasury bonds have been rising despite the Fed's efforts to push them down by purchasing Treasury securities. The Fed wants Treasury yields lower because they are a benchmark for many other private-sector interest rates -- including rates on mortgages. Concerns about large federal deficits, are one cause of the unwanted rise in yields. The wider the deficits, the more the Treasury borrows and the higher rates go. Wider deficits also stir inflation fears, which also push Treasury yields up. (more…)

Potent combination of FHA Financing, Steep Home Price Declines & Low Mortgage Rates

According to DataQuick Bay Area home sales posted a year-over-year gain for the eighth consecutive month in April. Santa Clara county had 1606 sales in April 09 compared to 1440 in April 08 up 11.5%. Alameda county had 1457 sales in April 09 compared to 1240 in April 08, up 17.5%. The question is what is causing this robust sales. I guess, I gave away the answer in the post header. Lets discuss the top 3 reasons one at a time. FHA Financing - In April FHA mortgages represented a record 26% of…continue reading →