Mortgage Rates & Trends 10/15/2013
Last week saw rates go up slightly,
an average of .125%-.250%, as the MBS (Mortgage Backed Securities) were trading
very tightly within a well defined range but lost 69 basis points. Also keeping
market performance and interest rates stable was the lack of economic reports
that would normally move the markets, most notably the jobs reports that were
missed on friday. This economic data was not released due to the government
shutdown closing the departments that do the reporting. Beware, as this is a
false stability that will likely end this week with the break in the logjam of
Washington D.C. talks regarding the debt ceiling and government shutdown.
This Week's Mortgage Rate Forecast
Mortgage Rates Forecast:
NEUTRAL, but high threat of volatility
This week will again show the calm
before the storm, as the markets hold their breath for the next move. Also
keeping the markets stable will be that many economic reports that are
scheduled for release this week will not be released. Expect traders to start
getting nervous as we are just a couple of days away from reaching our debt
ceiling, and Congress continues to play with fire. The markets have remained
calm up to this point, but expect tensions to continue to rise as the deadline
draws near. As the tensions rise, this may play out well for mortgage rates as
traders continue a flight to safety in bonds, and improve the pricing of
Mortgage Backed Securities. However it also could break the other way and we
could see a dramatic turn in pricing, so be very careful.
BOTTOM LINE: There is risk to floating right now, but also potential
reward. However, once news breaks that the shutdown is no longer an issue and
the debt ceiling is being dealt with, be prepared to act quickly. It is
critical this week to work with your Mortgage Loan Professional to stay a step
ahead of lender reprices and market trends to protect your mortgage rate.
I hoped you like the article and found it
informative. Remember, if you need assistance; do not hesitate on giving me a
call or any member of the team at 314-744-7806. Check us out on the website by clicking on
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