My email to friends this morning says, "LOCK 'EM IF YOU GOT 'EM!"
GREAT OLE' BIG DISCLAIMER: We are in a little different situation than most of our competitors, because we can allow folks to float their rate down until a few days before closing. If you are working with a "bank" like Wells Fargo, of BofA you might want to wait a few days before locking...
Okay- so the Fed worked with other Global Central Banks and coordinated a rate cut.
Our Fed rates went from 2.0 to 1.5.
If you're in the market for a mortgage, you might think that mortgage interest rates are diving today too! Hold up! As the news has been announced, I've been watching glued to CNBC, and the 10 yr TB (which mortgage rates loosely follow) has gone UP on the news!!!
Remember - the Stock Market took a bath during the last few days. TONS of money came "off the table" and as it's reinvested, it probably will not come back into BONDS. Mortgages (as we all now know) are sold as BONDS. It could be Monday or Tuesday before we know if mortgage rates are going to have any impact from this move.
PIMCO - at times the largest purchaser of mortgage back securities, and where Greenspan works - thinks that if the Fed lowers rates ANOTHER 100 to 50 bps, we will see a significant lowering of mortgage rates. They think this could spur on more purchases - and will allow folks to refinance. CAUTION! IF the Fed does lower again in the coming months - it will be a QUICK, SHORT period of time under 1% Fed rates. Much of the current mortgage problems are blamed on rates after 9/11 being TOO LOW.
If you are a consumer thinking you will purchase real estate at the next Fed Cut (if there is one), go see a lender TODAY. Let us help you get your scores up NOW! Underwriting Guidelines are getting tougher on October 10th, so having GREAT scores is important... and in most cases it's not that painful!
So be vigilent, now is the time to be in FULL CONTACT with your lender! If you are going to be a lender in this market - you need to be one of the smartest guys in the room!
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