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Mortgage Rates Report - Evergreen Colorado - RJ Baxter First Mortgage Corp

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Mortgage and Lending with Clear Path Home Loans NMLS #395819, #2564260

Mortgage Rates Report - Evergreen Colorado - RJ Baxter First Mortgage Corp

Mortgage Rates remained low last week, ending the week about where they began. 

The week, however, gave us plenty of drama and volatility.  The FOMC had their meeting and left short term rates unchanged with the added verbiage that the Federal Funds Rate will "remain exceptionally low for an extended period of time."  This commentary is interesting in the face of potential inflation, which would have a negative effect on Mortgage Rates.

Despite this fact, for now inflation remains subdued.  PPI numbers came out with the lowest reading in months, signaling that perhaps the FOMC is right for now, and inflation will remain low for awhile.

As I have written about over the past several months, the Fed policy of buying mortgage-backed securities will be ending on March 31st.  This could have a negative effect on Mortgage Rates, sending them higher.  However, continued low inflation readings and negative economic news could help keep rates low for an extended period.  One comment to take note of in the Fed policy statement, however, was that they are hinting they may start selling mortgage-backed securities, the opposite of what they have been doing over the past year to keep rates low.  If this happens, it will almost certainly provide upward pressure on Mortgage Rates.

This week should be interesting for Mortgage Rates.  The historic health care bill was passed by the House over the weekend, and the markets are still having a hard time figuring out how they will react this morning.  How the markets digest this news could have an impact. 

One concern I have for this week is the large supply of mortgage bonds hitting the market.  $180 billion in total is a lot of money flooding the market.  If the sale is not well received, Mortgage Rates will push higher.  In addition, we have a big economic calendar in store, with the biggest releases being Durable Goods on Wednesday and GDP on Friday.  The tone of these reports will certainly have an effect on Mortgage Rates.   Remember, generally speaking, negative economic news will send Mortgage Rates lower, while positive economic news will send Mortgage Rates higher.

Have a great week!

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RJ Baxter- Branch Manager, Educator, Speaker, Mountain Biker, Broncos Fan, Snowboard Shredder, Father of Two Crazy Kids

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