MortgageChanges.com

Rate Update

2011-02-23T11:46:00.001-06:00

Rate Update

2010-07-30T16:07:00.002-05:00

Mortgage rates started the day by going down today aided by early weakness in Stocks, off a soft Gross Domestic Product (GDP) reading.

But since then, the release of additional economic reports – which were still sluggish, but better than expectations – helped Stocks recover much of their losses, and caused rates to rise.

For today, I will recommend a Locking.

Have a great weekend.

Homebuying Is A Big Step

2010-07-23T13:55:00.002-05:00

Taking the step into home ownership is one of the most important financial decisions a person will make in their lifetime. There are many factors to consider when embarking on this venture. Literally hundreds of loan programs are available, and it is important to find the one that best fits your personal long-term goals.

First and foremost, you must have a mortgage consultant in your corner that is willing to take the time to know what your long-term goals are. Communication is the key factor here. Curious prospective home buyers sometimes turn to Internet-based services just to see what current interest rates are. But a faceless web site will not take the prospect’s future financial planning into consideration or guide the potential borrower through the many nuances of the loan process. When shopping for a home loan, be wary of web-based services that offer programs to reel prospects in with attractive rates that are based upon unrealistic time frames. If a lender is offering a terrific rate based on a 10-day lock-in period, it is unlikely that the potential home owner would actually be able to find their dream home, get through the negotiation process and win approval from a lender within such a short period of time. This is called short-pricing, and when it comes time to close the transaction, the rate that was originally offered is simply no longer available. As a result, the unfortunate prospect is bulldozed into a loan program with a higher interest rate. It is highly unlikely that a qualified loan originator whose business is based upon referrals will use unscrupulous tactics such as this to get new customers in the door!

Once you have found a mortgage consultant that you feel comfortable working with, lay your goals out on the table because it will have a tremendous impact on choosing a loan program that meets your specific needs. One of the most important factors to consider is how long you wish to borrow the money for. For example, if you know you will only be in the home for five years, it wouldn’t make sense to opt for a 30-year loan program or pay points up front to secure a lower interest rate. You would not be in the home long enough to benefit from such action.Your mortgage consultant should be able to narrow down a selection of programs based on the information that you have provided, and present you with an easy-to-read spreadsheet that clearly defines viable options for your interest rate and amortization schedule, monthly payment and any potential savings you may realize by paying points up front.

Moreover, a reputable loan originator will not hesitate to share this information with your tax consultant or financial planner so they may offer additional feedback on your behalf.

Home ownership imparts a rewarding vehicle for building wealth and a strong financial future. The mortgage consultant that you choose should be there not only when your loan closes, but should also provide you with ongoing service to assist you in managing that debt over time.

Life After Bankruptcy

2010-07-06T13:51:00.000-05:00

Bankruptcy is an uncomfortable subject for a variety of reasons. The most obvious is the potential havoc it can wreak on your finances. Running a close second is the negative stigma which is often attached to the process. This negativity is important to mention because strong emotions can sometimes lead to unsound financial decisions with devastating results.

Bankruptcy becomes a viable option for someone who is “upside down” in terms of cash flow. In other words, when a person has more money going out each month than coming in, bankruptcy should be considered if no reversal of this negative cash flow is within sight. The longer someone waits to explore the various options available, the more serious his or her situation may become.

One of the worst things people can do in this situation is to borrow more money to try and pay off their debts. On paper, this is clearly an unwise financial decision. In the real world, however, it is very common for individuals to pursue this strategy in an attempt to buy time and hold off on filing for bankruptcy. On the surface, this is certainly a noble notion; however it can often compound the problem and serves only to delay the inevitable.

For many homeowners in the midst of this upside down cash flow, speaking to a qualified mortgage professional is a much better option. An experienced loan officer can objectively look at your finances and help you determine if restructuring your mortgage would not only help, but possibly even alleviate any need for bankruptcy.

If bankruptcy is the only option, seek out a reputable bankruptcy attorney and credit counselor. A qualified mortgage specialist can provide references for you as well, as he or she works with these professionals on a regular basis. Reliable references are essential in this case because experienced professionals greatly increase the odds of a successful bankruptcy experience. It’s that simple.

When filing for bankruptcy, be completely honest and accurate regarding every aspect of your financial situation. This includes any changes to your income which may occur throughout the process. Bankruptcy is a federal procedure, adjudicated by real judges, and scrutinized by representatives who coordinate with the Department of Justice, the FBI, and the IRS.

Here are some additional steps you can take to make the bankruptcy process as painless as possible:

Save all paperwork regarding your bankruptcy, and keep it organized. This will prove beneficial after your bankruptcy as you now have all of the pertinent information in one place. Also, be sure to write down your discharge date. It’s surprising how many people forget to do this.
Establish a household budget. This can be accomplished in many ways, but there are several inexpensive computer programs available which do an excellent job.
Throughout the bankruptcy, do your best to not only live below your means, but to save as much cash as possible. You never know what you may need it for once the process is completed.
Be prepared for a barrage of junk mail. There will be sharks on the loose who are hoping to capitalize on your need for credit.

Tips for Rebuilding Credit:

If you must buy a car, focus on transportation as opposed to style. Buy an inexpensive, used car, and try to get a loan for it. It’s a good idea to figure out what your budget allows in terms of a dollar amount first. This means obtaining financing prior to looking for a car.
Get a secured credit card. Secured credit cards allow for the cardholder to deposit a said amount of money into an account, thus establishing the spending limit of the card. Missed payments result in deductions from the account. Some of these cards will reward responsible borrowers by upping the limit without an additional deposit. Some will even convert the account into a traditional credit card. (Be wary of offers of “easy credit” or any card which asks you to call a 900 number. You will be charged for the call.)
Meet with a credit repair specialist. Not only can they help you clean up the damage to your credit report, they can advise you on specific ways to rebuild the credit you lost as well.
While it does take time, there is definitely life (and credit) after bankruptcy. Some mortgage lenders will even lend to you within a year or so after a bankruptcy. If you’re in serious financial trouble, the trick is to get the help and advice you need from professionals you trust.

Rate Update

2010-07-06T13:46:00.001-05:00

Mortgage rates are holding onto last week's lows.

Stocks around the globe are higher this morning, thanks to some renewed confidence in European Banks after speculation that the stress tests are showing that European banks are stronger than previously perceived.

I recommend floating for now.

Rate Update

2010-07-02T14:09:00.000-05:00

"Mortgage rates started the day lower on worse-than-expected employment news, but have since given up their gains.

The official Jobs Report came in worse than expected, showing 125,000 job losses in June. The unemployment rate did fall to 9.5%, but that drop is due largely to 625,000 people being removed from the calculation because they're discouraged and no longer actively searching for work.

I reccommend locking today. Remember, the markets will be closed on Monday in observance of Independence Day."

Have a great weekend.

Rate Update

2010-06-29T10:32:00.001-05:00

"Mortgage rates are coming down this morning after some bad economic news around the globe – including union strikes in Greece and Spain, concerns over the condition of European Banks, and China's lending practices.

In the US, Consumer Confidence came in well below expectations, highlighting public concern about the overall economy and job market. While this is not good for our economy it is good for mortgage rates.

I recommend floating. I will keep you posted if a change of course is needed."

Protecting Your Credit During Divorce

2010-06-24T14:52:00.001-05:00

When a marriage ends in divorce, the lives of those involved are changed forever. During this time of upheaval, one thing that shouldn’t have to change is the credit status you’ve worked so hard to achieve.

Unfortunately, for many, the experience is the exact opposite. Unfulfilled promises to pay bills, the maxing out of credit cards, and a total breakdown in communication frequently lead to the annihilation of at least one spouse’s credit. Depending upon how finances are structured, it can sometimes have a negative impact on both parties.

The good news is it doesn’t have to be this way. By taking a proactive approach and creating a specific plan to maintain one’s credit status, anyone can ensure that “starting over” doesn’t have to mean rebuilding credit.

The first step for anyone going through a divorce is to obtain copies of your credit report from the 3 major agencies: Equifax, Experian®, and TransUnion®. It’s impossible to formulate a plan without having a complete understanding of the situation. (Once a year, you may obtain a free credit report by visiting www.AnnualCreditReport.com.)

Once you’ve gathered the facts, you can begin to address what’s most important. Create a spreadsheet, and list all of the accounts that are currently open. For each entry, fill in columns with the following information: creditor name, contact number, the account number, type of account (e.g. credit card, car loan, etc.), account status (e.g. current, past due), account balance, minimum monthly payment amount, and who is vested in the account (joint/individual/authorized signer).

Now that you have this information at your fingertips, it’s time to make a plan.

There are two types of credit accounts, and each is handled differently during a divorce. The first type is a secured account, meaning it’s attached to an asset. The most common securedaccounts are car loans and home mortgages. The second type is an unsecured account. These accounts are typically credit cards and charge cards, and they have no assets attached.

When it comes to a secured account, your best option is to sell the asset. This way the loan is paid off and your name is no longer attached. The next best option is to refinance the loan. In other words, one spouse buys out the other. This only works, however, if the purchasing spouse can qualify for a loan by themselves and can assume payments on their own. Your last option is to keep your name on the loan. This is the most risky option because if you’re not the one making the payment, your credit is truly vulnerable. If you decide to keep your name on the loan, make sure your name is also kept on the title. The worst case scenario is being stuck paying for something that you do not legally own.

In the case of a mortgage, enlisting the aid of a qualified mortgage professional is extremely important. This individual will review your existing home loan along with the equity you’ve built up and help you to determine the best course of action.

When it comes to unsecured accounts, you will need to act quickly. It’s important to know which spouse (if not both) is vested. If you are merely a signer on the account, have your name removed immediately. If you are the vested party and your spouse is a signer, have their name removed. Any joint accounts (both parties vested) that do not carry a balance should be closed immediately.

If there are jointly vested accounts which carry a balance, your best option is to have them frozen. This will ensure that no future charges can be made to the accounts. When an account is frozen, however, it is frozen for both parties. If you do not have any credit cards in your name, it is recommended you obtain one before freezing all of your jointly vested accounts. By having a card in your own name, you now have the option of transferring any joint balances into your account, guaranteeing they’ll get paid.

Ensuring payment on a debt which carries your name is paramount when it comes to preserving credit. Keep in mind that one 30-day late payment can drop your credit score as much as 75 points. It is also important to know that a divorce decree does not override any agreement you have with a creditor. So, regardless of which spouse is ordered to pay by the judge, not doing so will affect the credit score of both parties. The message here is to not only eliminate all joint accounts, but to do it quickly.

Divorce is difficult for everyone involved. By taking these steps, you can ensure that your credit remains intact.

Rate Update

2010-06-24T13:53:00.002-05:00

Mortgage rates started the day at the lowest levels ever. Thats right ever. But has sinced changed course.

In the news, Initial Jobless Claims came in slightly below expectations. Also, Durable Goods Orders for May signaled that the manufacturing sector is improving, albeit modestly.

I recommend locking today and taking advantage of these historic rates.

Rate Update

2010-06-02T15:48:00.000-05:00

Mortgage rates are flat today, and with the important Jobs Report coming up on Friday, traders may be reluctant to push Bonds much higher prior to the release of that potentially market-moving report.

In the news, Pending Home Sales for April came in above estimates and at the highest level since October 2009. Overall, the Pending Home Sales index is up 22% over April 2009.

I recommend floating today.

Rate Update

2010-05-21T14:20:00.002-05:00

Mortgage rates have been all of the place today. as Stocks started the day with another round of selling. The sharp sell-off in the Stock market has helped Bond prices of late, as some of the money from Stock sales is finding its way into the Bond market, including Mortgage Bonds. Some of this action reversed course this afternoon.

In other news, the Senate passed the controversial financial regulation bill last night with sweeping changes for the financial world. The bill must still be reconciled with the one passed by the House before being sent to the President to sign into law.

For now, I recommend floating as I monitor the situation to see how the direction in Stocks plays out.”

Rate Update

2010-05-18T16:15:00.001-05:00

"Mortgage rates are down today after some mixed economic reports this morning.

In the news, the Producer Price Index, which measures inflation at the wholesale level, was tame for the month of April. In other reports, Housing Starts in April rose above expectations to the highest level since October 2008, while Building Permits fell short of expectations. Although the overall data on housing is still mixed, this represents a good time for long-term investment in the housing market.

For now, I recommend floating.

Rate Update

2010-05-14T14:07:00.000-05:00

"Problems in Europe continue to dominate the headlines and influence global markets, as skepticism of Greek austerity measures pressured Stocks lower and weakened the Euro.

In US news, Retail Sales for April doubled expectations and marked the seventh consecutive monthly increase. However, with the uncertainty in Europe driving the trading activity, the news did little to influence the markets.

I reccommend floating today.

Rate Update

2010-04-30T15:39:00.000-05:00

Mortgage rates are down today however they have hit a floor and are having difficulty moving below it.

In the news, the Commerce Department's Gross Domestic Product report indicated that the economy grew for the third straight quarter, despite the report coming in slightly below estimates. Also this morning, the Consumer Sentiment and Chicago PMI reports beat expectations.

I recommend locking today.

Rate Update

2010-04-27T11:03:00.000-05:00

Mortgage rates are down a little this morning as we get more bad news from Europe and their financial situation.

However in US news, Consumer Confidence rose sharply in April to its highest reading since September 2008. This number is important because the more confidence consumers have, the more likely it is that they will help fuel the economy.

I reccommend locking and taking advantage of the gains.

Rate Update

2010-04-20T13:33:00.000-05:00

"Mortgage rates are near unchanged this morning, and there are no economic reports due for release today.

The ugly word "inflation" has reared its head. United Kingdom saw consumer price inflation rise sharply in March. The financial world has become quite small and interconnected. So higher inflation in the UK could lead to higher rates there, which would pressure rates higher in the US.

I recommend locking today.

Rate Update

2010-04-16T15:25:00.000-05:00

Mortgage rates have dropped a little today. However, breaking news that the Securities and Exchange Commission is charging Goldman Sachs with fraud on subprime mortgages is giving Bonds another lift.

In other news, Housing Starts for March came in higher than estimated and at the highest level since November 2008. Building Permits also came in higher. Despite the good news, Consumer Sentiment was reported below expectations, due to ongoing concerns over the job market.

I reccommend floating today, have a great weekend.

Rate Update

2010-04-09T11:30:00.000-05:00

After a much better week mortgage rates have started the day by going up.

Greece is in the news again today, and investors now sense a financial rescue package will help the country avoid default. The news is strengthening the Euro against the US Dollar, which is helping to give Stocks and Commodities a boost.

I reccommend locking today. Have a great weekend.

Rate Update

2010-04-06T14:28:00.000-05:00

Mortgage rates are down from their highs the last couple of days.

Later this afternoon, the minutes from last Fed Meeting will be released. These minutes may give us a better understanding on how individual Fed members feel about the 'extended period' language and the selling of MBS. We'll also see the results of the Treasury's $40 Billion 3-Year Note auction this afternoon, which could impact trading.

I reccommend floating for today.

Rate Update

2010-04-02T14:28:00.000-05:00

Mortgage rates are up today on the economic news of the day, the Jobs Report. While this is some great news for our economy, its not good for interest rates.

According to the report, 162,000 jobs were created in March, making it the biggest one-month increase in 3 years. Adding to the positive news were upward revisions to January and February, which brought the last two month’s net job losses near zero.

Although rates are still good right now, they are up and we can expect them to gradually head higher over time. I recommend locking at this time."

Rate Update

2010-03-29T13:13:00.000-05:00

In what has become common over the last week, mortgage bonds and interest rate are all over the place.

The Core Personal Consumption Expenditure Index for February was reported lower than anticipated, indicating that inflation remains subdued for now. Also in the news, Consumer Spending rose for the fifth straight month, while Personal Incomes were unchanged.

I recommend floating, for today.

Rate Update

2010-03-26T15:52:00.000-05:00

Mortgage rates are all over the place since the Federal Reserve stopped purchasing this week. We don't expect things to change anytime soon.

In economic news, the final reading on Fourth Quarter Gross Domestic Product came in lower than the previous advanced reading. Also in the news, Consumer Sentiment was reported slightly better than expectations.

I reccommend floating today, but be careful out there.

Rate Update

2010-03-22T12:59:00.000-05:00

Mortgage Bonds are starting the week improved from Friday.

Last night, the House of Representative passed the Healthcare Reform bill. Although the markets are not sure how to react just yet, the news could be a big factor over the next days and weeks depending on how everything shakes out.

I recommend floating for now.

Dont forget in order to qualify for the Homebuyer Tax Credit you must have a signed contract by April 30th.

Rate Update

2009-12-08T10:44:00.000-06:00

Well mortgage rates have regained some of their losses from last week. Bonds have had two good days in a row, after the comments of Chairman Bernanke yesterday. He said that inflation continues to stay in check, but says the economy will continue to face “formidable headwinds”. This has been viewed positive in the bond market.

I recommend floating for now, but that could change very quickly, stay tuned.

Rate Update

2009-12-04T09:47:00.000-06:00

Well its good news for the economy, but bad news for mortgage rates. In the last few weeks we had touched on historically low rates again. However we have seen positive economic news almost every day this week, especially today. Only 11,000 jobs were lost in the month of November, the expectation was 125,000 jobs lost. Also the unemployment rate came in at 10%, and was expected to be 10.2%. This is really hitting the bond market hard today, and rates are headed up as well.

As we have talked about before the climb out of this recession will not be a smooth one, we will have bumps in the road. A chart of this will look more like a W than a V.

For the near future I recommend locking as soon as you can. I will continue to keep you updated.

Rate Update

2009-11-24T11:58:00.002-06:00

Mortgage Rates are flat this morning. We had big news yesterday with the Existing Home Sales coming in above expectations and at their best level in 2.5 years. Also the index that measures home prices came in with a slight increase today. Both of these are a combination of the First Time Homebuyer Tax Credit and record low interest rates. Remember a 30 year fixed loan this time last year was 6.25%.

I recommend locking today, have a Great Thanksgiving.

National Average Mortgage Rates Today
30 Yr FRM 4.83%

15 Yr FRM 4.32%

Rate Update

2009-11-13T14:01:00.001-06:00

Bonds are up just a little today after the Fed stepped in yesterday by purchasing some more Mortgage Backed Securities. However we are nearing the end of their purchase program so look for rates to start increasing in the coming months. However in the short term we could see rates dropping as retail sales number come out for the holiday season. It will be a interest rate roller coaster over the next few months.

I recommend locking today.

Rate Update

2009-11-10T13:35:00.002-06:00

Mortgage bonds started in a positive direction today, but have since moved lower. The Treasury auction of 10 year notes didn’t go well. So interest rates are headed up today.

I recommend locking today, and feel free to ask me about the new Good Faith Estimate or HUD that is effective Jan 1 2010.

Rate Update

2009-11-06T13:51:00.000-06:00

Rates have come down a little this morning as the jobs reports were worse than expectations.

Please read below on Tax Credit, the President has just signed it. Contact me if you have anymore questions on it.

I recommend locking today and taking advantage of the gains.

Tax Credit Extension-Signed by President Obama

2009-11-06T13:50:00.000-06:00

To much anticipation and longing for further improvement in the mortgage and housing industry, the First Time Homebuyer Tax Credit will be extended today. The program, scheduled to expire at the end of November, will now require buyers to sign a purchase agreement by April 30, 2010 and close by June 30th. The FTHB Tax Credit Extension would include:

Buyers who have owned their current homes at least 5 years would be eligible for up to $6,500

First Time Homebuyers - or anyone who has not owned a home in the last 3 years would still be eligible for the $8000 Tax Credit

The credit is available for the purchase of principal homes costing $800,000 or less - vacation homes are ineligible

The credit would now be eligible to purchasers up to $125,000 in single income or $225,000 in joint income

The credit would be extended an additional year, until June 30, 2011 for members of the military serving outside the United States for at least 90 days

Extending the credit should allow more people to purchase a home and help stop the continued downward spiral in housing prices caused by the foreclosure crisis. The extension has been a priority to the real estate industry which says that the FTHB Tax Credit has been instrumental in the turn around of the market that was a major cause of the economic downturn.

The tax credit program will cost the government about $10.8 billion and the National Association of Realtors has estimated that out of the 1.4 million homebuyers that have already used the tax credit, about 350,000 would not have purchased their home without the tax credit.

Rate Update

2009-10-27T14:01:00.002-05:00

Bonds are having a good day and this should push rates back down to last week’s levels. Consumer confidence came in lower than expected and there was a Treasury auction that was well received. This news has helped mortgage rates.

Also there is a bill up for vote in the Senate to extend the $8,000 First Time Homebuyer Tax Bill until June 30th. More details this week.

I recommend floating today.

National Averages and Rate Update

2009-10-23T12:02:00.000-05:00

30 Yr FRM 5.00% Up 0.08%

15 Yr FRM 4.43% Up 0.06%

1 Yr ARM 4.54% Down 0.06%

5/1 Yr ARM 4.40% Up 0.02%

Rates are up today as we got positive news from Existing Home sales, they were up to 5.57m. Most importantly inventory shrunk to 7.8 month supply, down from 10.1 in April. Bonds have broken thru important support levels, and this is will increase rates even more.

Today I recommend locking.

Rate Averages and Update

2009-10-20T09:27:00.000-05:00

30 Yr FRM 4.92% +0.05%

15 Yr FRM 4.37% +0.04%

1 Yr ARM 4.60% +0.07%

5/1 Yr ARM 4.38% +0.03%

Mortgage Rates are coming down just a little today after weaker than expected housing reports and inflation numbers that are reasonable. Housing starts and building permit came out today and they were well below expectations. We have talked before about during a recovery the numbers wont continue to climb, they will bounce around each month.

Today I recommend floating, but will keep you posted.

National Average Mortgage Rates

2009-10-16T10:51:00.001-05:00

30 Yr FRM 4.92% +0.05%

15 Yr FRM 4.37% +0.04%

1 Yr ARM 4.60% +0.07%

5/1 Yr ARM 4.38% +0.03%

Rate Update

2009-10-16T10:44:00.001-05:00

Mortgage Rates are down just a little from their highs yesterday. Again the stock market is driving this as stocks are down from poor reports from GE, IBM and BofA.

Industrial Production and Capacity Utilization were reported better than expectations. These are positive signs from the economy. However what stocks are directing everything including bonds and rates.

I recommend floating today. Be sure to go to www.facebook.com/lukesmortgage and become a fan for a chance to win a new iTouch. Contest ends 10-21.

National Average Mortgage Rates

2009-10-13T13:30:00.002-05:00

30 Yr FRM 4.87%

15 Yr FRM 4.33%

1 Yr ARM 4.53%

5/1 Yr ARM 4.35%

Rate Update

2009-10-13T13:29:00.002-05:00

Mortgage rates are pushing back to lower levels after the beating they took last Friday. The decline in the stock market due to poor earnings reports has helped bonds and therefore interest rates.

I recommend floating today.

First Time Buyer Tax Credit

2009-10-09T14:26:00.000-05:00

On Monday, October 5th, the White House came very close to endorsing an extension for the First Time Homebuyer Tax Credit. The White House Press Secretary said it had been a very successful program and is on a “short-list” of measures being considered to help further bolster the economy in its recovery. The likely-hood for an extension of the Tax Credit has been significantly improved (as much as 90% likely to pass). There has been no indication of the Tax Credit being revised that would increase the credit above the already available $8000 limit or offered beyond first-time homebuyers within the qualifying guidelines.

What does this mean?

Unless the Tax Credit provision is made a “stand-alone” bill or attached to an existing bill, a continuation in the program may mean there would be a lapse in availability for First Time Homebuyers, possibly in early December - since tax bills usually move at the end of the year (late December).

It is speculated that a steep drop in home prices may unravel as the current First Time Homebuyer Tax Credit is left to expire December 1st, further denying economic recovery.

If extended, the $8000 Tax Credit program would cost the government approximately $1 billion for each month it is extended as talks are in place that would determine how long it will be extended.

Further details on the possible extension of the First Time Homebuyer Tax Credit will be published when they become available.

National Average Mortgage Rates

2009-10-09T10:09:00.002-05:00

30 Yr FRM     4.87%     -0.07%

15 Yr FRM     4.33%     -0.03%

1 Yr ARM       4.53%      0.04%

5/1 Yr ARM    4.35%      -0.07%

Rate Update

2009-10-09T10:08:00.000-05:00

The bond market had a bad day yesterday with the Treasury Auction that wasn’t well received. That has carried into today as well. Rates seem to be poised for another move higher. Since we are back near historic lows there are really only one way for rates to go, and that is up.

I have been asked my many followers of this blog to post actual interest rates. However that is so difficult to do given the rate adjustments for Loan To Value, Credit Score, etc. So what I have decided to do is post the National Average mortgage rate. Please understand it is possible to get a higher or lower interest rate than this given the individuals' situation.

I recommend locking today, and remember the markets are closed on Monday for Columbus Day.

Rate Update

2009-10-06T12:35:00.002-05:00

Mortgage rates are headed up this morning on the news that the Reserve Bank of Australia has increased their benchmark interest rate. This is a sign that the global economy seems to be headed in the right direction. Which is not good news for mortgage rates.

This news has also given new legs to the stock market, which is further bringing down the price of bonds.

I recommend locking today.

Rate Chart

2009-10-05T10:40:00.000-05:00

Rate Update

2009-10-02T12:58:00.002-05:00

Mortgage rates are down a little from the beginning of the week. The stock market hasn’t performed well this week and that has benefited Mortgage bonds. Today the Labor Dept reported that 263k jobs were lost in Sept. That is a higher number than was expected. In addition the unemployment rate went up to 9.8%. We will continue to see up and down numbers like this as the economy recovers.

Today I recommend locking and taking advantage of the gains earlier in the week.

Rate Update

2009-09-25T14:58:00.002-05:00

Its been a wild week for bonds and stocks. With the biggest news being that the Fed will continue to purchase Mortgage Backed Securities into spring of 2010. Their hope is that rates gradually trend up rather than rise sharply towards the end of the year. This should help conventional mortgage rates stay in the 5% to 5.5% until the first part of next year.

Today mortgage rates are up a little bit. The housing numbers that were released today showed continued signs of improvement. Remember as the economy starts to improve rates will increase as a way to fight off inflation.

I recommend locking today. Have a great weekend.

Rate Update

2009-09-22T10:24:00.000-05:00

Both the bonds and stocks are relatively flat today, as the market seems to be in a holding pattern. This is a light week for economic news so the biggest drivers will be the Treasury auction results and the Fed statement and rate decision which is coming tomorrow.

For all of our real estate partners there is some big news on the change to Good Faith Estimates, from RESPA. I will have some details later this week.

Today I recommend locking, have a great week.

Rate Update

2009-09-18T09:37:00.000-05:00

Bonds are down this morning which means we will see an small increase in rates. As is common the stock market is having a good day and money is coming out of bonds and into stocks. However stocks seem very volatile these days and we could see them pull back before the day is over.

Also there is some big changes coming on Good Faith Estimates from RESPA. I am currently putting together a brief summary of the changes for you. While there are some positives about the change, there are also some huge negatives that are detrimental to the consumer. These changes don’t go into effect until Jan 1, 2010.

I recommend locking this morning. Have a great weekend.

Rate Update

2009-09-16T09:47:00.001-05:00

The market is getting a mixed reaction with some economic numbers being a little higher than expected. This includes Consumer Price Index and Industrial Production. However the big fuel for the stock market is Warren Buffet saying the economy has bottomed out. Mr Buffet is a market mover in many ways.

All of these things haven’t been a positive for bonds or mortgage rates. However we are still in a good spot to lock in.

I recommend locking today.

Rate Update

2009-09-11T11:19:00.001-05:00

As we talked about earlier in the week, there wasn’t a lot of economic news that would affect mortgage rates this week. In spite of that bonds had a nice week of gains, which is good news for interest rates. We have finally broken thru the floor that has stopped mortgage rates a number of times in the last few months. However this could be very short lived as there is big news coming out next week.

Today Consumer Sentiment came in better than expectations, typically that would be a negative for bonds however they are holding on to their gains.

I recommend floating, but would be ready to lock at anytime.

Rate Update

2009-09-08T10:08:00.001-05:00

Bonds and rates are flat today, as stocks climb higher on the news that GE was upgraded by JP Morgan.

There isn’t a lot of economic news coming out this week however today’s Treasury auction on bonds could move rates.

I recommend locking today as we have seen these levels before and they don’t stay around long.

Rate Update

2009-09-02T13:19:00.001-05:00

The stock market has seen a slide downward in the past few days and there has been a positive reaction from bonds and mortgage rates. The main economic factor that is holding us back from a full recovery is the employment numbers. Again today the ADP employment numbers came in worse than expectations. But the productivity numbers were in line with expectations. This shows that businesses are maximizing productivity, without adding employees. Efficiency is a positive from an inflation standpoint, which is another good sign for bonds.

Today I recommend locking as we are at a floor that we have hit many times in the past months.

Jumbo Loans, Its Getting Better

2009-08-25T15:58:00.001-05:00

What makes a loan a Jumbo?
Jumbo loans are classified as a mortgage that is above $417,000 in most areas of Texas. Before the shakeup in the mortgage industry that was the limit for all of the US. So if you lived in many parts of the East or West coast, a high percentage of the mortgages were in the Jumbo category. In 2008 Fannie Mae/Freddie Mac put increased the limit in “high cost” areas. Currently in many parts of California you can get a conventional loan for over $700,000. This is all based on the median house price in a given area.

A quick history of Jumbo loans
Any loan that is not insured by Fannie, Freddie, HUD, or VA is considered a non-conforming or portfolio loan. That means that the lender is holding that loan in their portfolio and it is not backed by a government entity. Up until 2007 many different loans were included in the term non-conforming loans. This included Subprime, Alt-A, and Jumbo loans. These loans were packaged up, securitized, and sold on Wall Street. In many cases there would be 25 to 30% of jumbo loans in these packages, the rest were subprime loans. When everyone came to the realization that many of the subprime loans were over-leveraged or non-performing, then the jumbo loans were unfairly thrown into the same category. Then the credit crunch came along. Most lenders and banks began to horde cash and not loan money. Subprime and Alt A loans were gone almost overnight and jumbo loans were not backed by any government entity. So they had a similar fate. While many of the subprime loans were done with 0 down payment and poor credit, most jumbo loans still required a 5 to 20 percent down payment and above average credit. Currently the default rates on jumbo loans done in the last 5 years are lower than almost any other type of loan done in the same period. However because the investors that bought jumbo loans have been holding on to their cash, the market for those loans has been almost non-existent for the last 18 months. For the last 10 years jumbo loans required a bigger down payment and carried an interest rate from .25% to .50% higher than a conventional loan. That all changed in 2008, for the few lenders that would still buy a jumbo loan they were charging between 1.5% and 2% more than conventional loans. This has created big problems on the housing market in the upper end of price ranges. Because of this short supply and expensive financing the luxury home market has been reliant on buyers that could pay cash for these properties. That limits a large segment of potential buyers.

Current Jumbo Loan Market
However things have started to loosen up, some lenders are realizing the hole in the market and are starting to finance jumbo loans again. Today I can offer a customer with good credit and a 20% down payment a jumbo loan in the low 6’s on a 30 year fixed loan. While many lenders don’t have this product we do. If you know anyone that could benefit from this information please pass along my information.

Rate Update

2009-08-25T09:58:00.000-05:00

Stocks are up this morning as President Obama has reappointed Ben Bernanke as Fed Chief. This has helped stabilize the markets, investors don’t like to see changes at the top of the Fed. Bonds are down a little as stocks go up.

Also more reports were released today that showed home pricing increasing for the second straight month.

I recommend floating today, and will let you know if things change.

Also please tune in later today for my update on Jumbo loans, there have been some changes that will help the higher end of our market.

Rate Update

2009-08-21T11:46:00.001-05:00

After three days good days this week, Mortgage Bonds are headed in the wrong direction. As we talked about last week, we have hit this level a number of times and have yet to go below it.

The cause of this was Existing Home Sales which came in better than expected, as the housing market continues to show positive signs. While this is good news on an economic front, it also shows signs of inflation which is the enemy of interest rates.

I recommend locking and will keep you updated on any changes.

Rate Update and Big Mortgage News

2009-08-14T15:26:00.000-05:00

Bonds and mortgage rates have had a wild day. This morning the CPI (Consumer Price Index) fell 2.1%. This is great news for inflation and for rates. However we are back to that floor that we have hit so many times this year. Once that floor was reached rates started to go back up.

In other news Colonial Bank has been seized by the FDIC and its assets will be sold to BB&T. This will have huge implications as Colonial had many different interests in the mortgage business.

This is a great time to lock in a low interest rate.

Rate Update

2009-08-10T10:35:00.001-05:00

Rates are experiencing a little recovery of last weeks losses. Stocks are down which is fueling this rally. The big news of the week will be the Fed Policy announcement on Wednesday, however the Treasury auction will have the biggest effect.

I recommend floating today and will keep you updated as things change.

Rate Update

2009-08-07T11:13:00.000-05:00

We are starting to see a run of financial numbers that show we are starting to recover from the recession. Today it was the Jobs report, coming in better than expectations and Unemployment dropping as well.

This isn’t good news for mortgage bonds, however it is good for the overall economy.

I recommend locking today, as we have broken thru a ceiling on interest rates.

Rate Update

2009-08-04T10:38:00.000-05:00

Interest rates have gone up .25% in the last two days. Thanks to some good economic news and a positive run by the stock market.

Today the big surprise was the Pending Home Sales, the number was up considerably from expectations. Also inflation looks like it is staying in a good range, so that isn’t a concern at this point.

I recommend locking as I did last week.

Rate Update

2009-07-31T11:41:00.001-05:00

We have seen a little relief on mortgage rates, thanks to a better than expected Treasury Auction yesterday. Also the GDP came in better than expected, however consumer spending is still down. That makes sense with the increase we have seen in the personal savings rate.

I recommend locking today we have hit the floor on rates that we have seen 3 times in the last month. Each time rates pop back up. Have a great weekend.

Rate Update

2009-07-28T13:27:00.001-05:00

Mortgage bonds have been all over the place today. Currently we are in the same place we were on Friday. The cause of this big movement was the Case/Shiller Home Price Index which measures price and inventory of housing. These numbers were better than expected. However the Treasury auctioned off 42 billion in notes and this was not well received by the market. So we lost the positive ground that we saw earlier in the day.

I recommend locking today.

Rate Update

2009-07-24T11:00:00.001-05:00

Yesterday mortgage bonds had a bad day, this has caused interest rates to increase about .25% from Tuesday. The culprits on the increase in mortgage rates were the run of the stock market which closed above 9,000 for the first time since January. Also the positive news on the housing market caused this. We are currently down to a 9.4 month supply, this is the best number in 8 months.

Also Consumer Sentiment, which measures consumer attitudes came in as expected.

I recommend floating for now, however things could change quickly.

Rate Update

2009-07-21T11:00:00.001-05:00

Stocks and bonds are both up today, which doesn’t happen a lot. This should help rates come back down just a little bit, we are still north of 5%.

Big news of the day is Fed Chief Ben Bernanke is in front of House Financial Services Committee.

I recommend floating today, however things could change quickly.

Rate Update

2009-07-17T13:26:00.001-05:00

Bonds are down today which isn’t good news for mortgage rates. The main factor in this increase is the Housing Starts for June showed an increase. The last two months of this number show that the housing recovery may be underway.

However earning announced today from B of A, GE, IBM and Citi show that the economy is still difficult.

We seem to have to started the process of recovery and because of that interest rates will be all over the place for at least the next 6 months. During economic recovery you get many positive and negative signs, and that will create havoc with rates. That is why it is so important to be working with a mortgage professional that knows what is going on in the market.

I recommend locking today, have a great weekend.

Rate Update

2009-07-14T10:56:00.001-05:00

Mortgage rates have gone back up today, based on some economic numbers that could show signs of inflation. Tomorrow’s numbers will be important as well. In other news Goldman Sachs reported great earnings and paid back their TARP money.

I recommend locking today ahead of tomorrows numbers.

Rate Update

2009-07-10T13:55:00.001-05:00

After gaining some ground on Tuesday and Wednesday this week, bonds gave a lot of it back yesterday. The main cause of the positive pricing was the bond auction that the Fed held earlier in the week. Rates are just a little lower than we started the week with.

However stocks are down this morning thanks to poor economic numbers from the Balance of Trade report and the Consumer Sentiment.

I recommend floating as rates seem to have broken below an important floor and we could see some more positive reaction next week.
Have a great weekend.

Rate Update

2009-07-07T11:04:00.001-05:00

Stocks are down this morning, despite a jump in oil prices. Mortgage bonds and interest rates are flat. We are back to an important floor on interest rates that will be difficult to break thru. There is not much economic news out this week, however the Treasury is selling more bonds later in the week. How they sell will be important to the markets.

I recommend floating today, however the situation could change rapidly so stay tuned.

Rate Update

2009-07-02T11:11:00.000-05:00

Rates came back down to last week’s level, because of the poor employment reports and the strengthening of the dollar. However these have had a negative affect on stocks.

I recommend locking today and taking advantage of the gains. Have a great Fourth of July and hold a good thought for the people that continue to preserve our freedom.

Rate Update

2009-06-30T15:01:00.000-05:00

We just haven’t been able to hold onto the positive gains from last week. There is another range of resistance that we are bumping against.

Interesting news from the economy. First numbers came out today that shows that the decline of home prices is slowing in the 20 largest US cities. This may mean we are near the bottom on house prices. Secondly Consumer-Confidence came in lower than expected, indicating that consumers optimism in May was short lived.

I recommend locking today.

Rate Update

2009-06-26T10:57:00.000-05:00

Mortgage bonds came back in a big way yesterday, the comments from the Fed weren’t as inflationary as they could have been and this was a positive for both the stock and bond markets.

Also Personal Income and the Personal Savings rate went up in June this should help the markets as well. The savings rate has climbed to the highest level since December of 1993.

I recommend locking today and taking the gains of yesterday. Next week is a big vacation week and weird things tend to happen on a holiday week.

Rate Update

2009-06-23T15:35:00.000-05:00

Both bonds and stocks are almost flat today. We are in this strange 200 day moving average on both markets and it is creating a little bit of a stalemate.

There is speculation that the Fed will buy more bonds after their two day meetings that started today. This could give some short term relief to mortgage rates.

I recommend floating, and advise everyone that if the Fed gets us back below 5% not to wait around on something lower. At some point we are going to have inflation issues and those days are coming soon.

Rate Update

2009-06-19T14:27:00.000-05:00

Well the volatility in bonds has continued. The main issue is inflation which we talked about earlier in the week and also the amount of bonds that are out there on the market. The Fed continues to purchase Mortgage bonds, however they aren’t having a big affect at this point.

The wild ride will continue next week. For today I recommend floating, and will keep you updated.

Rate Update

2009-06-16T10:02:00.001-05:00

Well its been a crazy couple of weeks. Mortgage rates have fluctuated more than 1 point. We have settled between 5.25 and 5.5%. I anticipate staying in this range for the next 90 days or so. Right now the stock and bond markets are directly related. If the stock market rises then money is coming out of bonds and rates are going up. The opposite is also happening.

In other news Housing starts rose in May and came in better than expectations, this is a very good sign for the economy.

Today I recommend floating, however stay tuned because things could change rapidly.

Rate Update

2009-06-05T11:27:00.000-05:00

This mornings Jobs Report came in far better than expectations and the previous two months' job losses the numbers were revised down to show smaller declines. This is a good sign, but there will be more negative economic news before we are out of the woods. Despite the positive news the official Unemployment Rate--which is regarded as a more reliable indication of the employment situation--actually came in higher from 8.9% in April to 9.4% in May.

Because of this positive news we have taken another hit on Mortgage Bonds. Meanwhile stocks are up on the day. However we are up against a ceiling on Stocks and they could start to move lower. This would be positive for bonds and interest rates.

I recommend locking until we have some clarity on things.

All of this volatility has driven me to go on a short vacation, I will be out of the office June 8th thru 12th. However feel free to contact my partner Rudy Verdes at 972-665-1900 if you need anything. Have a great weekend.

Rate Update

2009-06-04T10:35:00.001-05:00

Mortgage bonds are falling again this morning as continued auctions of bonds are weakening the value of the dollar. It was announced an hour ago that the auction today would be smaller than originally planned, however it hasn’t helped bond prices yet today.

Jobless claims came in at expectations.

I recommend floating today, however be ready to pull the lock trigger.

Big News and Rate Update

2009-05-29T10:34:00.001-05:00

Big news hit the mortgage industry today regarding the $8,000 tax credit available to first-time homebuyers. According to the Federal Housing Administration, first-time homebuyers can apply the new $8,000 tax credit toward the purchase costs of a FHA-insured home. This is hot of the presses and more details will be released soon.

Also, the Gross Domestic Product for the first quarter fell at an annual rate of 5.7%, which was better than initial estimates. This good news that the economy may by turning.

As we talked about we expected a rebound in bond prices. This started late yesterday and has continued in today.

I recommend floating today.

Rates over 5%, What Happened???

2009-05-28T10:46:00.000-05:00

Yesterday, Mortgage Bonds had their worst one-day performance since October. This increased interest rates to over 5%. The cause of this was added supply in the market from the Treasury auctions and the increased number of refinances.

In other news, Initial Jobless Claims were better than expectations, while New Home Sales were just under estimates.

We should see a rebound from these prices, because the market has overreacted. However at this point our hope is to get back below 5%.

I recommend floating today.

BIG CHANGE

2009-05-27T15:31:00.002-05:00

Well we knew at some point this day was going to come.

Mortgage bonds have been absolutely killed today, mainly because of a lot of positive economic news, including existing home sales. We have increased about 1/2% since this morning. Which means we are now over the 5% mark.

On the bright side the economy is showing good signs of improvement, and that is a positive for everyone.

I now recommend floating, because a little of this is "over reaction" by the markets.

Rate Update

2009-05-26T12:19:00.000-05:00

After starting down the stock market has rebounded today, at the expense of bonds and therefore mortgage rates.

The main reason for this swing is that we saw the biggest one month jump in consumer confidence in over 6 years.

I recommend locking today, stay tuned.

Rate Update

2009-05-18T10:40:00.001-05:00

Mortgage bonds are flat today, mainly because the stock market is seeing another nice gain. This comes on the news that B of A is receiving a strong buy from Goldman Sachs and Lowes posted positive earnings. The other item driving the stock market is oil prices going up for the summer driving season.

There are no economic reports set for release today and this has helped rates stay flat even with the increase in stocks.

We are back to our historic lows on mortgage rates. Remember we have hit this point 5 times earlier and haven’t been able to go lower. Because of this I recommend locking.

Rate Update

2009-05-12T13:03:00.001-05:00

Chairman Bernanke said last night that the results from the “stress test” are encouraging. This has helped calm both markets as money was flowing out of stocks and into bonds. This has helped interest rates come close to their lows, once again.
As we near the rate of 4.5% remember this is a floor that we have hit 4 times earlier and haven’t gone below. Because of this I recommend locking today.

Rate Update

2009-05-08T15:26:00.001-05:00

Well with the more positive job reports, bonds and therefore rates have a taken a hit the last few days. However we seem to be recovering a little today.

Stocks are also trading higher on the news of the job reports, and the Bank Stress test came out better than most people thought.

I recommend floating today, but things could change quickly. Have a great weekend.

Rate Update

2009-05-05T09:41:00.001-05:00

Well the stock market had a big day yesterday, and the other good news is that the bond market didn’t suffer because of it. Bonds are up again today which is good news for rates.

However the government stress test said that ten large banks need to raise capital to stay afloat in this recession. This has caused stocks to come down from yesterday’s high.

Again today I recommend floating.

Rate Update

2009-05-04T09:40:00.001-05:00

The stock market is testing a ceiling this morning. If stocks are able to push thru we may see another strong push in the markets. Otherwise the market may drop back. The bond market has a nice floor of support and this is good for interest rates.

Also Warren Buffet was on CNBC this morning and was very optimistic about the financial and housing markets. He has always been ahead of everyone else, so look for everyone else to jump on the bandwagon in another 6 months or so.

With the floor of support in rates, I recommend floating.

Rate Update

2009-05-01T10:26:00.001-05:00

Bonds have taken a pretty good hit in the later part of this week. As the stock market is improving money is coming out of bonds and into stocks. This has not been good for interest rates.

The Fed reported it has been purchasing Mortgage Backed Securities, however they are still not buying a lot of bonds on the lower end. Consumer Sentiment and other numbers came through within expectations.

In the mortgage industry May 1st is an important day. As Fannie and Freddie have mandated a new way to manage the appraisal process. Feel free to email me for more details.

I recommend floating as bonds are holding onto a floor of support.

Rate Update

2009-04-28T13:07:00.002-05:00

Rates are off their best levels this morning, after they faced the same floor that we have now hit 4 times in as many months.

In other news, the government's "stress tests" for banks indicated that Bank of America and Citigroup may need to raise more capital. This isn't a major surprise, but does seem contrary to their recent favorable earnings reports. Also in the news, Consumer Confidence for April came in at its fourth largest gain in the history of the survey.

I reccommend locking as rates can't seem to go below this level.

Rate Update

2009-04-24T09:52:00.001-05:00

Mortgage Bonds are trading flat but starting to trend downward, which is not good for interest rates..

New Home Sales came out slightly better than expected, showing a 356K pace for March, whereas only 337K was expected. The good news was that the inventory number continues to fall – now at a 10.7 month supply, compared with February’s 11.2 months.

I recommend locking as there is an enormous $101B worth of Treasury supply hitting the market next week, which could weigh heavily on Bond prices.”

Rate Update

2009-04-20T09:57:00.000-05:00

The stock market is taking losses this morning and that is a positive for the bond market and interest rates. This is about three weeks in a row that the stock and bonds markets have reacted inversely, as they should. Stocks are down after the government has announced that they may convert their preferred stock to common stock in the financial institutions. This will dilute the share values, and that has investors reacting by selling.

Because of the pressure on stocks I recommend floating, but remember we are getting back to our interest rate floor that we haven’t been able to breakthrough.

Rate Update

2009-04-15T10:15:00.000-05:00

The stock and bond markets are both flat this morning, after Consumer Price Index and Empire State Manufacturing numbers came in a better than expected. This after the news from Goldman Sachs earlier in the week, is adding some stability to the market.

We are reached this level on interest rates 3 times in the last 4 months, and have hit the same floor. Because of this history I recommend locking today. I don’t see much upside to floating, with this floor in place.

Rate Update

2009-04-08T13:58:00.000-05:00

Both the stock and bond markets are up a little today. On the positive side of things Pulte Homes bought Centex Homes today in what essentially was a stock swap.
In the last year Centex has gotten out of the mortgage business and the homebuilding business.

Later today, the Fed will release the Minutes from its March meeting, and the government will auction off $35 Billion worth of 3-Year Notes.
Interest rates are back down to their lows of a couple of weeks ago. Again I think this is a floor on rates, we have hit it 3 times in the past and have yet to drop below it.

Because of this I recommend locking today.

Rate Update

2009-04-07T10:17:00.001-05:00

Bonds are up this morning as the stock market is having another bad day. Again the bank stocks are dragging it down. This however is good news for rates as we move back down to the historic lows of a couple of weeks ago.

There aren’t any economic reports out today, but companies start to report earnings from the 1st quarter. There probably won’t be many surprises here, and it won’t be pretty.

I recommend floating again today.

Rate Update

2009-04-06T13:22:00.000-05:00

The stock market is down today as a result of the bank stocks taking big hits. Again the Mark to Market change will help these companies long term, it will just take a little time to sort it out. In a “normal market” action the bond market is up because of stocks. This is what we normally see, but haven’t seen in months. Maybe this is a sign that things are starting to straighten themselves out.

The markets close early on Thursday and are closed on Friday for the holiday. Normally short weeks aren’t good for interest rates, but this one maybe a little different.

Since we are up from the lows of a couple of weeks ago, I recommend floating today.

Rate Update

2009-04-03T09:37:00.001-05:00

Well the jobs report was right in line with expectations. Also revisions for January and February were pretty close to original numbers. Both the stock and bond markets are relatively flat on this news. After just one day of the new accounting rules, we are hearing that things are already looking brighter for the banks.

I recommend floating today as I think rates will come back from our losses yesterday.

Rate Update

2009-04-02T13:40:00.002-05:00

Just as we talked about yesterday the Financial Accounting Standards Board (FASB) voted favorably to relax mark-to-market and help financial institutions. The big change is to allow financial companies to use alternate models, like cash flow analysis, in marking assets.

Also as predicted this has helped the stock market in a big way, and has been a negative for bonds and interest rates.

Also helping Stocks is optimism that the G20 meeting underway in London will agree on ways to pull global economies out of the current recession.

Again today I reccommend locking today.

Rate Update, Big Day Tomorrow

2009-04-01T10:54:00.002-05:00

Today numbers were released that showed 742,000 jobs lost in March, far worse than expectations of 663,000 jobs lost and the worst reading in ADP's nine years of reporting as the labor market continues to struggle.

However its not affecting the Stock and Bond markets as both are flat today. Challenger, Gray & Christmas, an executive outplacement company, released some findings today stating that planned layoffs at US firms fell in March to their lowest in six months.

Tomorrow the Accounting Standards Board is going to release their decision on "Mark to Market" accouting. It is expected that they will revise the current guidelines. This could be a huge boost to the Stock market, and normally that is bad for interest rates.

Because of that I reccommend locking today.

Rate Update... We Are At The Bottom

2009-03-31T15:46:00.002-05:00

Bonds are down a little today, because the stock market is rebounding a little bit.

Interesting note on the unlikelihood of rates moving much lower - last Friday, Jack Koskinen, interim chief executive of Freddie Mac, said that home loan rates are near the bottom and that any further decreases will be small.

In other news Consumer Confidence is up a little over last month.

For now, I will continue to recommend locking, as I cant see much upside to floating.

Rate Update

2009-03-30T14:51:00.002-05:00

Bonds are up a little today, as stocks are selling off.

The bad news from the auto sector is driving the stock market and US dollar down today, as a lot of people figured out we are still in recession.

While this hurts, it will not last forever.

I recommend floating for now, but be prepared to lock in this historic opportunity."

Rate Update and Why Rates Arent Lower

2009-03-27T10:22:00.003-05:00

Sorry you haven’t seen an update on rates this week, a couple of family emergencies prevented me from doing my usual posts.

Bonds are up a little this morning due to reasonable inflation numbers and the fact that stocks are moving lower. Personal Income and Spending came inline with estimates. And as expected Personal Savings rate was up. Rates are in historic lows, and this isn’t a time to gamble. I recommend locking.

Also I have been receiving a lot of questions about why rates arent lower. Please watch the clip from CNBC, it sums it up well.

Big Rate Update

2009-03-19T11:03:00.001-05:00

Yesterday afternoon the Fed gave us another surprise by announcing they will purchase another 750 billion of Mortgage Back Securities or Bonds. This news has driven rates down to the lows of a couple weeks ago.

The important thing to remember is that the Fed is buying 5% and 5.5% coupon bonds. These bonds equate to mortgages in the 5.75 to 6.5 range. This does keep rates low, but still a long way from 4% as the media is talking about. Because of this we are now showing some signs of inflation which is the arch enemy of rates. Also the large lenders are holding back and not pricing all of the market gains because they are overloaded with loans right now. It goes to a supply and demand philosophy.

I recommend locking today and taking advantage of the gains.

Rate Update

2009-03-18T10:02:00.001-05:00

The Fed is meeting today and there isn’t much chance they will change rates. However their Policy Statements could have an effect on both markets. Inflation numbers came out today and were actually a little higher than expected. But remember a little inflation at this point is much better than deflation. The stock market is taking a small hit and our “steady eddy” bond market is flat again today. Which means rates are flat again, this is a welcome change from the last few months.

I recommend floating today, but will keep you updated with any changes.

Rate Update

2009-03-16T10:48:00.000-05:00

Bonds are down a little this morning as the stock market is making another run upward. Wow it feels good to type that. The main reason for the run is the big banks say they are back to being profitable. Also Fed Chairman Bernake stated again that the recession should end in 2009.

I recommend locking today and taking advantage of gains the past few days.

Also check out the new "Poll of The Week"

Rate Update

2009-03-13T10:48:00.000-05:00

Both the stock and bond markets have been all over the place today and are currently flat. There are a couple of reasons for the volatility today. First China is concerned the US may be spending too much on the recession. China is the largest single holder of US bonds. Also the stock market is reacting to the Congressional hearings on mark to market accounting and the news that Citigroup seems to have risen from the dead. They announced today they do not need anymore TARP money. This is a good sign.

For now I recommend floating and will let you know if anything changes. Have a great weekend.