Mortgage Rates Hold Steady, Lock'em If You Got'em
Posted 11-20-2009 at 07:28 AM by VictorBurek
The trading in the fixed income sector was very slow and boring yesterday. Mortgage backed securities moved in a very tight range which kept mortgage rates unchanged on the day. Unlike Wednesday, the economic data wasn’t the friendliest for the fixed income sector; however, weakness in the stock market helped to keep MBS near the top of the trading range which has kept rates near six month lows.
The Treasury Department announced yesterday a new supply of 2 year, 5 year and 7 year notes which will be auctioned next week. On Monday, $44billion of 2 year notes will be auctioned to the highest bidders followed by $42billion of 5 year notes on Tuesday and $32billion of 7 year notes on Wednesday. The added supply of debt on the markets will pressure treasury prices to fall to attract buyers. As the price of treasuries fall, the yield moves higher which could pressure mortgage rates higher. So far this year, despite record amounts of government borrowing, demand for our nation’s debt remains strong which is one of the many factors that have attributed to record low mortgage rates.
There is no scheduled release of any economic data today.
Reports from fellow mortgage professionals indicate mortgage rates to be unchanged from yesterday. The par 30 year conventional rate mortgage continues to hold in the 4.625% to 4.875% range for well qualified consumers. To secure a par interest rate you must have a FICO credit score of 740 or higher, a loan to value at 80% or less and pay all closing costs including an estimated one point loan origination/discount/broker fee. As always, you can elect to pay less in closing costs and secure a higher interest rate or pay additional discount points to buy the rate down further.
Next week we do have some impacting reports hitting. Tuesday we get GDP and Consumer Confidence. Wednesday brings us Durable Goods Orders, Personal Income and Outlays, Jobless Claims, Consumer Sentiment and New Home Sales. All markets are closed on Thursday and Friday they will close early.
My lock bias is still in effect. If you are still floating it is time to take advantage of the rates we have this morning. Next week we do have some high impacting reports that can move the markets but it is a shortened holiday week. As Thanksgiving approaches and the markets are closed, lenders tend to get more conservative on their pricing.
Hope everyone has a wonderful weekend.
The Treasury Department announced yesterday a new supply of 2 year, 5 year and 7 year notes which will be auctioned next week. On Monday, $44billion of 2 year notes will be auctioned to the highest bidders followed by $42billion of 5 year notes on Tuesday and $32billion of 7 year notes on Wednesday. The added supply of debt on the markets will pressure treasury prices to fall to attract buyers. As the price of treasuries fall, the yield moves higher which could pressure mortgage rates higher. So far this year, despite record amounts of government borrowing, demand for our nation’s debt remains strong which is one of the many factors that have attributed to record low mortgage rates.
There is no scheduled release of any economic data today.
Reports from fellow mortgage professionals indicate mortgage rates to be unchanged from yesterday. The par 30 year conventional rate mortgage continues to hold in the 4.625% to 4.875% range for well qualified consumers. To secure a par interest rate you must have a FICO credit score of 740 or higher, a loan to value at 80% or less and pay all closing costs including an estimated one point loan origination/discount/broker fee. As always, you can elect to pay less in closing costs and secure a higher interest rate or pay additional discount points to buy the rate down further.
Next week we do have some impacting reports hitting. Tuesday we get GDP and Consumer Confidence. Wednesday brings us Durable Goods Orders, Personal Income and Outlays, Jobless Claims, Consumer Sentiment and New Home Sales. All markets are closed on Thursday and Friday they will close early.
My lock bias is still in effect. If you are still floating it is time to take advantage of the rates we have this morning. Next week we do have some high impacting reports that can move the markets but it is a shortened holiday week. As Thanksgiving approaches and the markets are closed, lenders tend to get more conservative on their pricing.
Hope everyone has a wonderful weekend.
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