Mortgage Rate Forecast for September 14, 2010 - Improving, or...?
Here are some of the events affecting mortgage rates today:
What Mortgage Backed Securities (MBS) Are Doing Today:
- The price of the FNMA 30-Year 4.0% MBS coupon opened at 102.56 this morning - the same as yesterday's close.
- At 9:30 AM, the 4.0% MBS coupon was trading at 102.75 - up 6/32 from its opening.
Remember, on mortgage backed securities (MBSs), as the price goes down, the yield goes up - and so do mortgage rates. I expect that mortgage rates will be as much as 0.125 points better in price this morning as compared to yesterday afternoon.
Price Trend in Mortgage Backed Securities:
The chart below shows the price trend of the FNMA 30-Year 4.0% coupon over the past 30 days from 8-15-2010 to 9-14-2010:
Economic Reports, News, and Events Affecting Mortgage Rates Today:
- Retail Sales Report - Consumers are still spending. Retail sales rose 0.4% in August, slightly better than expected, and follows a revised 0.3% increase in July and a 0.3% decrease in June. When auto sales are excluded, retail sales rose 0.6%. When auto and gasoline sales are excluded, retail sales rose 0.5%. Overall, retail sales are up 3.6% from this same time last year. The retail sales report measures consumer spending by tracking sales at retail establishments. This is one of the more important reports we see each month because consumer spending makes up two-thirds of the economy. The retail sales report shows that consumers are still spending, and provides comfort to retailers who are concerned about a possible double-dip recession. This report had no impact on the mortgage market or mortgage rates this morning.
Trend in Mortgage Rates:
The chart below shows the trend in mortgage rates over the past 5 years:
Mortgage Rate Forecast:
Mortgage rates are coming off their historic lows as the overall economic outlook is beginning to improve. Given the most recent economic and job reports, it now appears that mortgage rates are as low as they will ever go.
If you're thinking about refinancing your mortgage and if these low mortgage rates make sense to you, then take advantage of them while you can. If you're happy with the mortgage rate being offered to you today and if you don't want to risk mortgage rates moving higher, then you should apply and lock in now. It's better to have locked when you should have floated than it is to float when you should have locked.
Are you in need of a mortgage to purchase a home? Or want to refinance an existing mortgage into a lower permanent fixed rate? Or want to take cash out of the equity of your home? Or consolidate debt and reduce the monthly bills? Then be sure to request a mortgage rate quote today!
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