Rates Continue to Imrpove

Interest rates have continued to improve... and bond analysts are considering the fact that their markets and prospective yields may move even lower. That means offered interest rates could go lower as well. How much lower... we are at RECORD LOWS again, when making history its difficult to predict because historical data is not available, so we follow the trend, and right now the trend is positive.

Despite these low rates mortgage applications remain flat which suggests home buyers are not out in the numbers we need to stabilize the housing market. Are we lining up for a double dip? Are more foreclosures going to be hitting the market? Are home prices going to turn down again? These are all legitimate questions and anyone that immediately brushes them off is not being very realistic.

Buying now is by no means a bad move. Waiting to see where the real estate market settles in the next couple of months is not a bad move. Ignoring the opportunity available to refinance into a lower rate or ignoring the low home prices and rates available for borrowing, knowing your options - these are the people I worry about.


Above is a one year graph of the mortgage backed securities market. This market is producing the lowest consumer rates in history. Anyone not interested in paying less for money they have borrowed... didn't think so.

Back

Good day everyone... I hope all have been busy originating new business in the wake of these low rates. I have been out on personal matter for the last week and why you have not seen posts over the last week or so.

Rest assured I am back and hope all of you did not miss me too much... The market over the last week, I am happy to report has been stable and remained relatively unchanged.

To the left you will find a five day graph illustrating a clear range in which we have been trading. This is why rates have been steady. Interestingly, investors are comfortable at these high points, which suggests our market may improve further bringing rates even lower. I wouldn't bank on this, but it is possible.

Right now the real issue is delivering to investors. Keep in mind these are mortgage notes they are buying into, and if we (lenders and agents) are not originating new business, investors are left without product... no product and well they'll only hang around for so long.

I am not worried about our market.... after all one person sells another buys, but we must continue to move inventory and create demand for investors. New demand is critical, so let's turn it up, and get cracking. There are buyer's everywhere.

Open House Flier

Below you will find this weeks open house flier which you may print out and use to compliment your own marketing material.

Of course if you need preapprovals over the weekend to complete your offers we are available. Have a productive weekend.

104.00 Breakout

Today we broke through the 104.00 price point which has been acting as resistance to our market. This has lead to very good rates moving into the weekend. We will have our open house flier published shortly to compliment your marketing material this weekend at your open houses.

Monday will be a very interesting day, which we are hoping provides additional support to our market moving forward. Assuming we do not sell off it will mean 104.00 is beginning to turn coat, acting as support as opposed to resistance, which has been its authority recently.

Currently purchase loans should consider 45 days, although a 30 day escrow is still achievable if the borrower is prepared with supporting paperwork.

These rates are what we have all been hoping for. Let's make the most of our market while these rates are so low.

Markets Improve

Mortgage rates improved today... underwriting turn times got longer... make sure you plan close of escrow periods accordingly. Although the news is reporting mortgage applications are down, our recent experience has been the opposite, although a great deal of demand has been for people looking to refinance.

Even so, we are seeing activity in regards to purchase loans starting to pick up. One problem we are seeing is the general public is not fully aware of just how low rates are. Point in fact, we can now secure a rate of 3.875% on a conforming 30 year fixed home loan right now with an APR of 4.204%.

That's an awesome deal... currently the media is reporting 30 year mortgages at a rate of 4.57% If people only new what was available wholesale, the fence sitters might become home buyers.

We are happy to issue preapprovals to anyone looking to buy a home, and can have an automated approval in less than an hour of taking a complete application.

Now would be the time to educate your prospects, make sure they understand just how low rates have moved.

A Strong Day of Gains

It was a strong day in the mortgage backed securities market, evidenced by the graph to our right. Curiously however, reprices were slow to come, some not at all from lenders that you would have expected improvement from. If you are currently approved with a lender that did reprice, take a good look at the rate sheet, if you're approved with a lender that didn't reprice, holding off until tomorrow's opening may prove to be the smart play.

We have to play close attention to that treasury yield (yellow) which is rising slowly but surely. This will put pressure on our market should it continue.

Additional considerations include longer underwriting turn times at the most favorable lenders. As a result most are either floating in open market for a longer period of time, or forced to take a 45 day lock to ensure they will not need extensions at the time of closing.

Considering this fact, it would be wise to begin paperwork and submit as soon as possible if you are considering taking advantage of these rates.

Settlement...

Yesterday at close our market settled and the July coupon closed out and we rolled into the August coupon. As expected this brought our market down, which is evidenced by the fall at the close yesterday.

Despite this, pricing this morning is still very favorable, and slightly better than yesterday's close. Even so, we are currently down two ticks in secondary which is not a good sign for future rate sheets. This sell off is due to a stock market rally, which I don't see dissipating today. Best we can hope for today is strong support at our current trading level. This would reinforce current pricing and encourage investors to buy leading to a rally. Wishful thinking, but completely plausible.

We are down off highs... the doomsdayers may see this as an opportunity, and believe me there are still plenty of people out there questioning the overall health of our economy.

A Good Start...

Last week our market struggled, and there was the distinct possibility that the current low rates may not be available in the near future. Today, this fear has been curbed, as treasury yields turn South, and the mortgage backed securities market posts gains. We are now back at historic high levels, with the the 4.5 coupon trading at 103.31. 104.00 (just one tick away) we broke through earlier today, but saw a retraction. This price point is a level of resistance, which we have come across before.

The difference is today we are making a strong run at the 104.00 price, and could break through today. Here's my prediction... should the 10 year treasury yield fall back below 3.000% today, we will see the mortgage backed securities market break through the 104.00 resistance.

In closing, yes our market is back at its highs, but it is going to take a little time for rate sheets to catch up. I do expect better pricing to be published by lenders this afternoon, however... if our market holds at these levels for a day or two pricing will only continue to improve as banks stop hedging against the market.

Open House Flier

Below you will find this weeks open house flier with updated rates. Feel free to use this to compliment your own marketing material at open houses this weekend. Hope all goes well. Should anyone need preapprovals we are of course available.

Danger Sideways

Today's trading is a little unnerving... we make an immediate jump at the open, only to have it bleed out back to zero over the last couple of hours. Meanwhile the treasury yield is sitting above 3.000%, and much like a stubborn child after ice cream, will not be reduced.

It may be a little early to call the close, but I anticipate we will move into this weekend with the treasury yield still above 3.000% and the mortgage backed securities market trading somewhere above 103.20 on the 4.5 coupon. Recent highs for this coupon have been 103.31, and I am optimistically hopeful that we will break this level, when is a anyone's guess.

Right now moving into the weekend, rates are slightly off their lows, but still very attractive. I will be publishing the weekly open house flier shortly that will be available for use in open houses this weekend.

Let's make it a productive weekend. We will be available to provide preapproval letters for anyone that needs them and is looking to make an offer over the weekend. You will find our contact information on our website: Pacific Mortgage Consultants.

The Open House flier will be available in a separate post on this blog shortly.

Sideways... but be Careful

Today ended up one tick. Typically any day we post gains is a day I can end happy. But I must confess today's close has me a little unnerved. The treasury yield has creeped above 3.000% which will pose as serious competition to our market come opening.

Considering the day we did out perform treasuries... but tomorrow is a different day, and we may end up on the short end of the stick. Tomorrow will take its cue from the ten year yield. Should it slide back under 3.000% we will be in a much safer position.

Right now our market is vulnerable to a possible sell off. Then again we could post gains tomorrow, should we see the yield shrink back below 3.000 as mentioned above. In the long run, I do think rates will continue to improve albeit at a slower pace than we have seen. In the short term it is a little harder to predict.

Sideways...

This morning we are trading sideways. That's a fancy way of saying rates are holding right now. This is good news considering rates are currently at their best levels - EVER.

Officially we are down one tick right now in the mortgage backed securities market, which is not a whole lot... and is most likely due to the rising treasury yield which is currently 2.973% yield. As long as we stay under 3.000%, I'm okay with this minor fluctuation.

The long and short of it... I am not reading too much into the weakness we are seeing today. Periodic retreats back are to be expected and a natural occurance in any market.

As far as the stock rally is concerned, I find it unconvincing, low volume and traders hesitant to get short ahead of earnings. I do not think this is a run and expect the stock market to remain below 10,000 and the S & P to continue hovering around 1040.00

My plan is to keep an eye on our market and not react prematurely... should support levels be violated in the bonds market, we will reevaluate long term positions.

New Highs Will Bring Lower Rates...

It's has been a favorable day in the mortgage market. Currently up 10 ticks on the day, we are once again breaking through historic levels. Although current rate sheets have not priced these gains in, we can expect to see slightly better pricing tomorrow based on today's trading. Or, we'll see an updated rate sheet this afternoon.

As long as the 10 year treasury yield stays below 3.000%, mortgage rates will remain at these low levels.

I hope everyone had a wonderful 4th of July. With summer officially underway, a CA tax credit, and the lowest rates ever, there are many incentives for new home buyers. It is time to make this summer a summer worth remembering. We look forward to assisting you with your clients preapprovals.

Have a great day.

Open House Flier

This weeks open house flier. Feel free to use this to compliment your marketing material in any open houses you are hosting this weekend. These rates are current and good through the long weekend.
For preapprovals we will be available, and open throughout the weekend, and on Monday which banks are taking off as holiday. You can find all of our contact information on our website: www.homeloanorg.com

Consolidation...

The sideways trend continues today as our market consolidates moving into the long weekend - banks are closed on Monday. With that said we will be open and ready to draft preapproval letters for those of you that require them.

Check back shortly for this weeks open house flier. All of you can use this flier to compliment your marketing efforts at open houses you are hosting.

All things considered, our market was supported today which was important for rates moving forward. The jobs numbers were not good, shedding 138,000 this month. In addition factory orders were down 1.4%, which is huge. It suggests the future of our economy is more bleak than most media outlets are leading us on to believe. All things considered I think rates are going to stay low moving through the long weekend.

Contact us with any questions, or leave a comment here.

Sideways...

Think tomorrow morning is going to be very interesting for our markets... we posted minor gains today, with very volatile trading habits. All things considered investors want to see the job numbers tomorrow.

This weekend rates are going to be very good. Remember to check in tomorrow for your open house rate sheets.

As for additional news, some of the prime lenders offering the best rates are starting to get a little back logged causing delays on approvals and underwriting turn times. This may lead to extensions... talk about this with your lender now so it doesn't blindside you toward closing.