Mortgage markets improved last week ahead of Memorial Day and a 3-day weekend. Bond pricing ending the week higher, pushing conforming mortgage rates in Michigan down for the 5th week out of six.
Most economic news reported worse-than-expected. Initial Jobless Claims increased sharply, GDP was unchanged, and Durable Orders posted the largest one-month decline since October. Each of these stories reduced inflationary pressures on the economy, contributing to lower mortgage rates.
However, the main driver for U.S. mortgage rates last week was Europe.
One year ago, Greece pledged to lower its spending, cut its deficit, and reduce the number of public programs and benefits. In economic circles, this is known as austerity. For more than a month, however, despite the austerity measures, there has been concern that Greece will fail to meet its debt obligations.
Last week, that concern spiked. It triggered a flight-to-quality that helped U.S. mortgage bonds, and led mortgage rates lower.
Conforming and FHA mortgage rates are now at their lowest levels in more than 6 months.
This week, the biggest news is May's Non-Farm Payrolls report. Although, expect for rates to carve out wide ranges from day-to-day. Until the Greece scenario reaches a resolution, Wall Street will be on edge.
- Tuesday : Consumer Confidence, Case-Shiller Index
- Wednesday : ADP Challenger Report
- Thursday : Initial Jobless Claims
- Friday : Non-Farm Payrolls Report
Plus, four members of the Fed have scheduled speeches.
If you're still floating a mortgage rates, or have otherwise not locked in, luck is on your side. Mortgage rates look poised to fall over the next few days, however, markets have been known to reverse quickly. Therefore, if you've been quoted on a rate that looks acceptable to you, you may not want to gamble on mortgage rates falling further.
The safest decision may be to commit to what's available to you today.