The government shutdown has come to an end, but how does the House's last minute deal and the post-shutdown environment impact mortgage rates? With the debt ceiling stalemate in Washington resolved at least until February 7, 2014, rates could dip in the short term. In fact mortgage backed securities (MBS) climbed 95 basis points last week. When MBS goes up in price, mortgage rates go down. The week saw another .125% improvement in rates and brought the average 30 year fixed rate closer to 4%. Home builders stalled by the government shutdown will…
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Mortgage Rates
Fed, Lies and Mortgage Rates
There have been a string of striking turnabouts by Fed officials in recent months that have whipsawed mortgage backed securities (MBS) markets. Who Said What and the Impact on Mortgage Rates May 22, 2013 - Federal Reserve Chairman Ben Bernanke answered Congress's questions about when the central bank might begin to slow down its monetary stimulus program, “If we see continued improvement and we have confidence that that is going to be sustained, then we could in the next few meetings we could take a step down in our pace of purchases, he…
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Employment News Causes Biggest Single Day Increase In Mortgage Rates
Hope you had a "happy 4th". Now say hello to the "unhappy 5th". The Mortgage Backed Securities (MBS) market saw fireworks of a completely different kind. The market went down by an unprecedented 200 basis points - the steepest single day fall in modern MBS history. In simple terms - we saw the biggest single day increase in mortgage rates. Within two weeks, we have now witnessed biggest weekly increase and biggest single day increase in mortgage rates....ever!! Mortgage rates move in the opposite direction to MBS. When MBS go down in price,…
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MBS Blood Bath – Worst Week For Mortgage Rates On Record
Mortgage rates just witnessed the worst week on record. During last 3 days, rates were changing on an hourly basis. Just when I thought I have seen it all, we get a week like this. Its a loan officer's worst nightmare come true. In last seven days I had already written two posts on mortgage rates. I had no plans of writing another till next week. But I couldn't let a news like this go unreported. Mortgage Backed Securities (MBS) that directly impacts the mortgage rates went down by a jaw dropping 314…
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Mortgage Rates Rise To The Highest Level In 18 Months On Bernanke Statement
Mortgage rates continue its relentless rise. After reaching historical lows at the end of April, the rates have increased for 7th straight week. Today's statement by Fed chairman Ben Bernanke further worsened the market. By end of the day, rates were at a 18 months high with outlook of more worsening in sight. Mortgage rates rise and fall based on how mortgage backed securities (MBS) trade on Wall Street. After Bernanke's statement the MBS went down by a whopping 120 basis points - one of the largest single day drop in recent times.…
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30 Year Fixed Mortgage Rates Rise For Sixth Consecutive Week
30 Year Fixed Mortgage Rates for California and rest of the country increased for sixth consecutive week. After touching a low of 3.35% in early May, the 30 Year Fixed Rate is at 3.98% according to Freddie Mac weekly mortgage survey. During the same time period, 15 year fixed has moved from 2.56% to 3.10%. Both rate options are at 0.7 points and applies to conforming loan balance under $417,000. Mortgage Bankers Association's (MBA) survey which is usually more accurate in my opinion reported a higher rate. According to MBA, the average interest…
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Mortgage Rates Reach A Point Of No Return
The month of May, 2013 saw the steepest one month hike in mortgage rates in last 5 years. In the last five weeks, 30 year fixed mortgage rates have climbed 0.50% to 0.75%. Interest rates for virtually all the loan programs have increased substantially. Freddie Mac in its latest weekly survey reported that the fixed mortgage rates increased for the 5th week in a row. In the May 2, 2013 survey the 30 Year Fixed mortgage rate was reported at 3.35% with 0.7 points; last week that increased to 3.91% with 0.7 points.…
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Mortgage Rates Rise Sharply On Better Economic News
Its been a bad month for mortgage rates. In 3 weeks the mortgage rates are up 0.25% to 0.375%. Freddie Mac's weekly survey on April 25th, 2013 reported the 30 Year Fixed at 3.35% with 0.7 points. May 16th survey reported 3.51% with 0.7 points. A quick look on Bank Rate today shows 3.66%. All these rates are for conforming mortgages under $417,000. Loans over that limit are typically 0.25% higher in rate. Get a Live Rate Quote Mortgage rates are directly impacted by how mortgage backed securities (MBS) trade on Wall Street.…
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California Mortgage Rates Trend Lower After Rising for Several Weeks
The first Friday of every month is almost always one of shock and awe; the release of the monthly employment data is rarely a calm event. The March data released last Friday did disappoint in terms of surprise. The news improved Mortgage Backed Securities (MBS) price by 40 basis points (bps) on Friday and 122 bps for the week. MBS usually goes up in price on a weak economy news. The increase in MBS has an inverse effect on mortgage rates i.e. when MBS prices go up, mortgage rates go down. Get a…
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Employment News Takes Mortgage Rates To Highest Levels In Over a Year
After weeks of worsening rates, it seemed California mortgage rates were getting stable. But the employment report and some other news last week delivered a knockout punch to any hope of rates getting better. Mortgage rates are directly impacted by how mortgage backed securities(MBS) are traded on wall street. If MBS fall in price, the rates go up. On Monday and Tuesday the MBS fell by 9 basis points (bps) each. Thats only a minor impact on rates. But then on Wednesday and Thursday it went down by a whopping 66 bps. If…
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