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Mortgage Rates, In a snapshot: Week ending July 24, 2009

What moved rates? Why did they move? and, How did we end up where we are today?

From time to time we have bouncy weeks that will have big swings in rates on a daily to almost hourly basis, This week was one of them. It was entirely possible to call me in the morning and in the afternoon and be quoted to entirely different rates in a given day, but if I quoted rates last Friday and again this Friday it would look like NO CHANGE. Yet from Friday of last week to Tuesday it looked like a home run. That is the Fun of the mortgage business, and all the more reason you need a trusted mortgage adviser helping you in the biggest investment of your lives.

Here is a quick synopsis of this week:

This has been a bumpy ride for Mortgage rates this week with some mixed signals that have the market confused.

Monday was a fairly quiet day that ended up in positive territory with a gain of about 6/32's in Fannies The real news started with the Biggie of the week on Tuesday as Bernake was getting Grilled like a porterhouse at Outback. His comments were scary, but scary in a good way for the credit markets. He feels that the markets will not return to any sustainable growth until the end of the first quarter of 2010 and that they will keep the target rate near 0% for the foreseeable future, this sparked a rally in mortgages that had the day end with a gain of 15/32s.

On Wednesday the market was fairly flat most of the day, but by day's end we saw a bit of profit taking and we lost 5/32's

On Thursday Stocks saw a Rally that ate up a lot of the gains we had early on in the week. Part of the problem here is the marked caught wind of the Treasury auction for next week. We are expecting a record $115 BILLION in treasuries to flood the market and added supply is always a concern in the Supply/Demand world the markets live in. The fear of the excess supply along with the equities markets stealing from the credit markets caused a loss of 15/32s by the end of the day.

Well, Friday is over as I type this, and we had a slightly negative market most of the day with some quick spins from negative to positive and back again only to end up with a loss of 1/32ndby time 5pm rolled around.

if you do the quick math, that is a bouncy week that had Fannies absolutely UNCHANGED from Monday Morning till Friday Afternoon...

This quick synopsis of the week should help explain the fluctuations that you can expect from day to day (sometimes hourly) trading in the credit markets.

Have a great weekend

Rob

Robert Rauf

Mortgage Banker

www.RobertRaufHomeLoans.com or my blog: http://activerain.com/blogs/rrauf

(732)223-1630 x102

Since 1987 I have been helping my clients fulfill their dream of home ownership!

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Posted by Robert Rauf on 07/24/2009 04:29 PM

Comments (7)

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7 Comments on Mortgage Rates, In a snapshot: Week ending July 24, 2009

JUL

I hope this quick run down of the week gives you an idea of what moves rates and why they can be so volatile

it does and that is what makes the world go round economically speaking.,

thanks for stopping by Monika!

Oh Mighty Wise Loan Guru - LOL Ok, enough Friday afternoon foolishness (its 2:45 here and I am sooooo ready for the weekend). Anyway, I heard that the Fed is going to start buying different kinds of coupons than they have been which will have an immediate impact on rates for the rest of the year. Any truth to that?

Whether we like it or not we are tied to what happens on Wall Street. The market reacts to so many factors that it seems impossible to keep up with everything that impacts it. It is all so entertwined.

Thanks for the update. Still great rates for purchasers.

Donne, it is hard to say what they will do, they have been stepping in and buying to calm the markets all year, sort of an easing of rates by spending dollars, along with buying some higher rate stuff(treasuries) which is not much more than Uncle Sam refinancing some of their debt. they have been sporadic, so it is a difficult to tell what they will or will not do, the big fear is that they step out as a buyer all together.

Liz, So true.

John, you are 100% correct, still historically low rates, what a great opportunity if you are going to stay in your home for the long run!

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