Mortgage Rate Update 10-3-14: Trends & Projections

Mortgage and Lending with AmeriFirst Financial Inc, San Diego, CA NMLS 259027

October 03, 2014 03:40 AM

It has been a volatile morning following the release of the key Employment Report. Against a consensus forecast of 215K, the economy added 248K jobs in September. The figures for prior months were also revised higher. Meanwhile, the unemployment rate dipped to 5.9% but this was due to ta continuation of the troublesome trend of lower participation rates.

Compared to Friday's closing, the market has opened with a 0.125 - 0.250 WORSENING to the Points/Credits associated with any given interest rate option.

This daily mortgage interest rate report is designed to provide Borrowers & Real Estate Profesionals with factual data regarding where rates are at any given time and what trends are propelling current mortgage pricing on any given day. Feel free to browse the library and research historical rate updates dating back over 2 years at www.JasonGordon.info whenever desired. To make things easier, I have also posted a quick report on How To Read The Charts Below.

Also, make sure to learn THE TOP 10 THINGS TO KNOW ABOUT MORTGAGE RATES (to help understand the relationship between rates & fees/credits) along with THE TRUTH BEHIND MORTGAGE QUOTES (to better understand the relationship between up-front closing costs and mortgage interest rates so you don't get duped by clever advertising campaigns). Remember, we all make better decisions in life when we have the actual facts to analyze...share this report with those whom you care about!

San Diego Mortgage Rates - Jason Gordon - www.JasonGordonMortgage.com

The Mortgage Street Smarts of where mortgage interest rates are going (and why):

The following information is current as of Friday 10-3-2014 and will help you understand today's 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 Thursday with an IMPROVEMENT to pricing. Thursday's IMPROVEMENT netted a change of 3 basis points (bps).

(Note: Upward activity on these charts is GOOD, downward activity is BAD)

Best Mortgage Rates in San Diego - www.GordonMortgage.com

The following chart summarizes todays market activity:

Best Mortgage Rates in San Diego - www.GordonMortgage.com

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 (Neil Trenerry)

FNMA - Month Aug

Cpn 3.0 Chg -0.1875 Bid 98.96875

Cpn 3.5 Chg -0.2188 Bid 102.46875

Cpn 4.0 Chg -0.1250 Bid 105.65625

Treasury

UST 5 YR Chg -0.2578 Bid 100.00000 Yield 1.7500

UST 10 YR Chg -0.3125 Bid 99.15625 Yield 2.4720

UST 30 YR Chg -0.2813 Bid 99.28125 Yield 3.1620

Currency

Euro Bid 1.2526 Chg -0.0142

Pound Bid 1.6002 Chg -0.0140

Yen Bid 109.500 Chg 1.090

Light Crude

Last 91.02

Key Economic Data:

Payrolls for Sep

Non-Farm: Actual 248k, Consensus 215k, Last 142k.

Private: Actual 236k, Consensus 210k, Last 134k.

Manufacturing: Actual 4k, Consensus 12k, Last 0k.

Government: Actual 12k, Last 8k.

Unemployment Rate: Actual 5.9%, Consensus 6.1%, Last 6.1%.

Average Earnings: Actual 0.0%, Consensus 0.2%, Last 0.2%.

Average Workweek Hrs: Actual 34.6h, Consensus 34.5h, Last 34.5h.

International Trade for Aug: Actual -40.1b, Consensus 40.9b, Last -40.6b.

6:45: Markit Comp Final PMI fpr Sep: Last 59.70.

7:00: ISM N-Mfg for Sep

PMI: Consensus 58.5, Last 59.6.

Bus Act: Consensus 63.5, Last 65.0.

Employment Index: Last 57.1

New Orders Index: Last 63.8.

Price Paid Index: Last 57.7.

7:30: ECRI Weekly Index: Last 134.9.

Advice:

The U.S. jobless rate declined to a six-year low of 5.9 percent in September and employers in the U.S. added more workers than projected, signs of more vigor in the labor market that will help sustain faster economic growth. The 248,000 gain in payrolls followed a 180,000 August increase that was bigger than previously estimated, the Labor Department reported in Washington. The median forecast of economists in a Bloomberg survey called for a 215,000 advance. The unemployment rate fell to the lowest level since July 2008 from 6.1 percent. We appear to be ending the third quarter on a solid note, Sam Bullard, senior economist at Wells Fargo Securities LLC in Charlotte, North Carolina, said before the report. This will continue the trend of gradual improvement weve been seeing so far since 2014. Theres greater traction in the U.S. economy right now. Sustained, elevated gains in hiring are needed to help bring about faster wage growth and put the expansion in a self-reinforcing cycle of more consumer spending and employment opportunities. Federal Reserve policy makers are trying to determine the extent of labor-market slack as the central bank approaches the end of asset purchases aimed at boosting growth. Todays report showed average hourly earnings were stagnant in September from a month earlier. The stronger-than-expected increase in net hiring last month reflected a pickup at grocery stores, factories and restaurants. Estimates in the Bloomberg survey of 100 economists ranged from gains of 155,000 to 265,000 after a previously reported 142,000 advance. Revisions to prior reports added 69,000 jobs from payrolls in the previous two months. The unemployment rate, which is derived from a Labor Department survey of households, was projected to hold at 6.1 percent, according to the survey median.

My position on MBS:

Short term stays Short.

Long term stays Short.

Long = I anticipate pricing to improve which leads to lower Rates.

Neutral = Market should stay close to open plus or minimums 25bps.

Short = I anticipate pricing to weaken which leads to higher Rates.

Short term = 1 - 2 days out

Long term = 30+ days out

Market Commentary (Dan Rawitch)

The combination of the 102.80 resistence and the payroll numbers have carried bonds to what I hope is the bottome of the trading range. More people found jobs, but income is still not rising, this will not put wage pressure on the market and should contain inflation, yet more support for lower rates. For now...look for a range of 102.40 to 102.80

http://www.ratewatch.com/ratewatchnow.html

Trusted Industry Advisor

San Diego Mortgage Rates - Jason Gordon - www.JasonGordonMortgage.com

The above information was compiled and distributed by San Diego Residential Mortgage Specialist, Jason E Gordon in an effort to provide transparency regarding true mortgage rate activity and market guidance to consumers and professionals interested in this activity. All Market Commentary is provided via The Mortgage Coach and/or their RateWatch technology software.

As a Certified Mortgage Planning Specialist (CMPS) Certified Distressed Property Expert (CDPE) Certified Mortgage Coach (CMC), and Certified Military Housing Specialist (CMHS), 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.GordonMortgage.com or www.CrossApproval.com or more information.

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