All Real Estate Professionals & Consumers are advised to stay informed about interest rates and learn THE TRUTH BEHIND MORTGAGE QUOTES. Introducing an easy-to-follow inside look at mortgage rate activity, featuring charts, rate sheets, market commentary, and even video recordings all in one daily morning article! Whether you're a newbee, market analyst (or somewhere in between), keep yourself informed of where mortgage interest rates are going (and why).
The Mortgage Street Smarts of where mortgage interest rates are going (and why):
The following information is current as of Thursday 6-2-2011 and will help you understand todays best mortgage rates. If you are a Buyer/Borrower who is still on the fence (or if you are a Real Estate Agent attempting to educate your "on the fence" Buyer), please review these trends and secure an historically low interest rate before it is too late.
The market closed Wednesday with an IMPROVEMENT to pricing (and will typically warrant a pricing adjustment by most Lenders). Wednesday's IMPROVEMENT resulted in a change of 37 basis points (bps).
The following chart shows the market activity for today (hint: upward activity is good, downward activity is bad):
The following chart shows market activity over the past 10 days (hint: green is good, red is bad):
The following chart shows market activity over the past 1 month:
Daily Interest Rate Snapshot (sample of rates from one of the country's largest Lenders...individual pricing will vary based on specific Borrower qualifications): NOTE: This Lender has quoted a 1.00% Origination Fee (1 Point) to accompany this pricing. It bears noting that this chart does not necessarily represent todays best mortgage rates.
Market Commentary
Analyst #1 (Neil Trenerry):
FNMA 30-Yr 4.0%
Previous close 101.250
Opened Down 0.15bp @ 101.094
Key Economic Data:
EUR / USD 1.4469 Up 0.0140
USD / JPY 80.8030 Down 0.1475
GBP / USD 1.6355 Up 0.0021
Oil 100.50 Up 0.21
Gold 1,541.70 Down 1.50
Key Economic News:
Initial jobless claims higher than expected, and higher level no longer obviously related to temporary factors.
Key Numbers:
Initial jobless claims 422k in week of May 28, vs. median forecast 417k.
Continuing jobless claims 3,711k in week of May 21, vs. median forecast 3,675k.
Nonfarm productivity +1.8% (qoq, ar) in Q1, vs. median forecast +1.7%.
Main Points:
1. Initial jobless claims fell to 422k in the week ending May 28 from 428k in the previous week. However, the level of claims was higher than the consensus forecast (Median: 417k). The four-week average fell to 425k from 440k previously. Claims are now about 30k higher than the average level in February. In contrast to the sharp increase in late April, today's level no longer appears obviously related to special factors-such as auto production cuts, poor weather, and seasonal adjustment bias (based on the mix of states that have seen claims increase). At the same time, the current level of claims is also probably consistent with ongoing growth in nonfarm payrolls, and is therefore less discouraging than many recent reports. We are holding our forecast for May nonfarm payroll growth at 100k.
2. Separately, the BLS revised up its estimate of Q1 nonfarm productivity growth to 1.8% (qoq ar) from 1.6% previously. Growth in unit labor costs was revised down to 0.7% from 1.0% previously.
10:00: Factory orders (April): Input for Q2 GDP. The monthly factory orders report will provide more detail on why new orders for capital goods weakened again in April (as initially reported in the advance report on durable goods). The release will also include estimates of manufacturing inventory accumulation during the month, and therefore may have an impact on expectations for Q2 GDP.
Median forecast (of 67) -1.0%; last +3.4%.
Advice:
My position on MBS changes to neutral (close long position).
Analyst #2 (Dan Rawitch):
Here is the link to our daily video http://ratewatch.com/ratewatchnow.html
The bad news keeps rolling and the fed keeps quiet. The combo of these facts is beginning to create some normalcy in the markets. The kind of normal where bad means bad and the market does not come up with a crack based interpretation.
Today is further confirmation that both manufacturing and jobs are in trouble. We got our housing confirmation earlier this week! So, there is your Trifecta which most likely leads to a double dip recession and VERY low interest rates.
Short term, we may close the gap. Also, be mindful that we've moved up 2.5 points with NO correction. The market may start looking for an excuse to correct. On the other hand, I think we visit 102 in the near term.
Trusted Mortgage Industry Resource
The above information was compiled and distributed by San Diego Residential Mortgage Specialist, Jason E Gordon. As a Certified Mortgage Planning Specialist (CMPS) Certified Distressed Property Expert (CDPE) and Certified Mortgage Coach (CMC), Jason E Gordon utilizes his advanced training to examine a prospective Client's complete financial picture, while carefully listening to their overall goals. If it is mutually agreed that a new loan makes sense to pursue, Jason strives to make the entire loan process as seamless as possible. He truly believes that providing open communication and patient educational guidance to his Clients and Business Alliances has been a pivotal component to building his business, while enhancing his reputation in the Mortgage Industry as a Trusted Advisor. Visit www.jasonegordon.com for more information.
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