Mortgage Rates Steady Yesterday

Mortgage rates were steady on the most part, even though we did see a decrease in the Mortgage Backed Securities (MBS) today.  The most prevalently quoted conforming 30yr fixed rates for top tier borrowers was at 3.875% with 3.750%, coming into play more depending on what fees made the most sense with each rate. 

After opening lower (price) this morning the bond and mortgage markets spent the day with not much change.  We believe that is a plus given the big increases in prices last week in MBSs and treasuries – that we didn’t experience a bigger sell-off today suggests the bond and mortgage markets remain strong, stronger than most are thinking.  The stock indexes flopped around like that fish on the dock; closing lower after the DJIA ran up 123 points early on today. Interest rate market bulls are not as lonely now as we were three weeks ago when the majority were looking for interest rates to increase - the longer outlook in our view is for rates to stay low through most of 2015. Possibly a little higher - but before that we see rates falling further after the FOMC meeting on Wednesday.  The reason - the global economic condition is weak and here in the US there really isn’t any significant improvement in jobs and prices.

The number of jobs being created is on the headline strong, about 300K a month of new jobs over the last six months, quality though is poor as I have commented numerous times.  The central banks around the world are doing everything they can (printing money quickly) but the results are mediocre at best.

Nothing is likely to change until Wednesday afternoon when the FOMC releases its policy statement and Janet Yellen’s press conference.  The general view currently is the Fed will change its phrasing relating to when it will begin increasing interest rates.  But do not expect a direct answer as the Fed speaks in another language.

In summary, the mortgage rates are still low for the year.  I attempt to give advice based on the highest probability of rates over the next few days, and while I believe we may see lower rates ahead, I cannot honestly feel comfortable for you to wait and see if that happens.  That is why I am suggesting to people to lock if you are ready to close in the next few weeks, but cautiously float if you are feeling lucky. 

Remember, if you want to know the benefits of locking your rate today versus floating, simply give me a call at 314-744-7806 or visit my website at www.CallTheMoneyMan.com. I have access to real time Wall Street data and instant market alerts with breaking news that I monitor throughout the day to assist us on making the informed decision.

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