Mortgage News

Rates Hold Near Lows, But Things Could Change Tomorrow

Mortgage Rate News - 4 hours 45 min ago
Mortgage rates moved microscopically higher today, depending on the lender. In terms of underlying movement in the bond market, however, rates should have risen a bit more than they did. This has to do with the timing of the bond market weakness and the amount of movement lenders typically want to see before changing their mortgage rate offerings for the day. Simply put, weaker bonds suggest higher rates, but bonds didn't weaken fast enough for most lenders to see their "re-price" threshold. All of the above means that most lenders continued to offer rates that were very close to the lowest levels in more than a year. Only a handful of days have been any better, and all of them have occurred in the past 2 months. Much of the credit for the recent drop in rates goes to the well-publicized trade
Categories: Mortgage News

Mortgage Rates End Week Near Long-Term Lows

Mortgage Rate News - Fri, 05/17/2019 - 16:04
Wednesday was the best day this week for Mortgage rates with the average lender at the lowest levels in more than a month and very close to the lowest levels in more than a year. Things changed on Thursday with rates moving up slightly. That said, Thursday would have been the best day in more than a month had it not been for Wednesday! Friday brought effectively no change to Thursday's levels, thus keeping the average lender very close to long-term lows . In fact, the average loan quote won't have changed in terms of the quoted interest rate during the past 3 days--only in terms of the upfront costs. In other words, APR would be slightly higher while the payment rate itself would be unchanged (APR factors certain upfront costs into a total cost of financing). In the bigger picture, rates have
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Mortgage Rates Ebb Higher, But Only Slightly

Mortgage Rate News - Thu, 05/16/2019 - 17:56
Mortgage rates hit the lowest levels in more than a month yesterday and came very close to the lowest levels in more than a year. Things changed today , but only slightly. Without a fresh supply of drama or weaker economic data, the bond market deteriorated. Bonds typically benefit when investors are seeking safe havens in response to economic risks. This pushes bond prices higher and yields (aka "rates") lower. Whereas there were concerns about Italian budget news and a weaker reading on Retail Sales yesterday, today brought stronger economic data across the board. Bonds reacted by weakening (i.e. moving higher in yield/rate) and that was basically that. If there's a saving grace for the bond/rate market is that the weakness found a limit fairly quickly and rates were only modestly higher
Categories: Mortgage News

Rates Close In On Lowest Levels in Over a Year

Mortgage Rate News - Wed, 05/15/2019 - 17:06
Mortgage rates have had a few first world problems to complain about recently. Well, there's really only been one: a relative inability to keep pace with the broader decline in rates as seen in the Treasury market. If Treasuries are the "master," mortgage rates are the proverbial dog on a leash. The dog can pull ahead, heel faithfully, or drag recalcitrantly behind. The latter has been mortgage rates' M.O. for the past few weeks owing to some abstruse loan performance data that made investors rethink the value they were placing on mortgage investments. But now, the broader rate market has done well enough over the past two weeks that even the mortgage market is forced to participate. To be clear, mortgage rates haven't dropped nearly as much as Treasuries, but at least they've dropped! The
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Mortgage Rates Holding Near Recent Lows Ahead of Retail Sales Data

Mortgage Rate News - Tue, 05/14/2019 - 16:41
It's been a while since the bond market (which dictates rates) has been able to digest what we would consider to be a "top tier" economic report. Why do we care about such things? Simply put, economic data is one of the key considerations for bonds. Stronger data tends to promote bond selling and thus higher mortgage rates . Conversely, when the data is weaker than expected, it generally coincides with rates holding ground or moving lower. The "all other things being equal" caveat is imperative when it comes to economic data's impact on rates. There are certainly other factors that can supersede even the most important reports. That said, the other things are rarely scheduled in advance unless we're talking about monetary policy updates from the Fed or other major central banks. So will tomorrow
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Lowest Mortgage Rates in More Than a Month

Mortgage Rate News - Mon, 05/13/2019 - 17:27
Mortgage rates moved moderately lower to start the new week as trade tensions remained in focus. In general, the worse the US/China trade relationship is looking at any given moment, the better it has been for the bond market (and the worse it's been for stocks). This is typical behavior for markets because stocks tend to benefit from growth and certainty while bonds tend to benefit when investors are uncertain, downbeat, or looking for safe havens to ride out volatility. As bonds 'benefit' from that demand, prices rise and rates fall. Today's drop brings the average lender back to the lowest rates since April 2. Despite the seemingly big move, Friday's rates weren't too much higher. In fact, many borrowers will be seeing the same interest rate at the top of a loan quote with the only difference
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Rates End Week at Highs as Drama Dies Down

Mortgage Rate News - Fri, 05/10/2019 - 17:46
Mortgage rates moved up on Friday, ultimately making it to the highest levels of the week for the average lender. Underlying bond markets came under pressure as Trump made several reassuring comments about the future potential for a trade agreement between the US and China. Before that, trade war headlines dominated the week and had taken rates and stock prices generally lower. The net effect is that the market should shift from worrying about this week representing a dire deadline to expecting an ongoing and nuanced process. That nuanced, ongoing process is not as good for interest rates as the panic that preceded it. That means there's a legitimate risk that rate momentum is higher until and unless some economic or political event comes along to make a case to the contrary. Loan Originator
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Mortgage Rates Unchanged to Slightly Lower

Mortgage Rate News - Thu, 05/09/2019 - 16:51
Mortgage rates were just slightly lower on average today with some lenders flat and others distinctly lower. The discrepancy is due to the timing of yesterday's market movements and the corresponding lender reactions. Some lenders saw enough weakness to reprice for the worse before the end of the day. Others just let it ride. Those who repriced were able to drop rates back in line with yesterday morning's rates today. Those who didn't reprice just remained in the same territory, making this the 4th straight day with very little change despite a more pronounced move lower in 10yr Treasury yields. Financial markets continue hanging on every headline pertaining to the trade war. In general, news that makes a deal seem less likely is good for rates while news that increases the odds of a deal pushes
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Mortgage Rates Sideways to Slightly Higher

Mortgage Rate News - Wed, 05/08/2019 - 17:23
Mortgage rates began the day in decent shape after more trade war drama courtesy of a Reuters story overnight. In general, trade war drama pushes stock prices and bond yields (aka "rates") lower. But as we discussed yesterday, mortgage rates hadn't been able to benefit from that drama nearly as much as US Treasuries (the benchmark/yard-stick against which all other US interest rates are compared). In fact, they were very close to unchanged even though Treasuries were making a case for a nice move lower. It looked like that might change this morning as Treasury yields continued lower and the bonds underlying mortgages managed to improve modestly. Indeed, a few lenders did offer rates that were just slightly better than yesterday, but they were counterbalanced by just as many lenders on the other
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Mortgage Rates Stay Sideways Despite Bond Market Gains

Mortgage Rate News - Tue, 05/07/2019 - 18:15
Mortgage rates didn't move much today, if at all. This is confounding to all those who have watched rates against the backdrop of 10yr Treasury yields (and especially those who don't qualify their view that "mortgage rates follow the 10yr Treasury yield." Indeed, such a view must always be qualified with a word like "generally" or "typically." Today offers proof with 10yr yields significantly lower (more than 0.05%) whereas the average mortgage lender is unchanged. What's up with this? It is true that the bond market does more than anything to dictate mortgage rate movement. While 10yr Treasuries tend to correlate very well with the bonds that underlie mortgages, that correlation can periodically break down. When we look at actual mortgage-backed securities (MBS), we see they didn't fare nearly
Categories: Mortgage News

Lowest Mortgage Rates in a Month

Mortgage Rate News - Mon, 05/06/2019 - 17:13
Mortgage rates dropped noticeably this morning as financial markets opened sharply changed from Friday's latest levels thanks to Trump trade tweets over the weekend. The stock market dropped to its lowest levels in several weeks before bouncing back as the day progressed. As money flew out of stocks, it found a safe haven in the bond market. Mortgage rates are most directly affected by the bond market, and when demand for bonds increases, rates fall. The average lender was offering its best rates in roughly a month this morning. You'd have to go back to April 10th to see anything lower. And there were multiple lenders offering their lowest rates since April 1st. Rates will remain susceptible to trade-related headlines throughout the week as there isn't much else on the calendar of events (at
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Mortgage Rates Hold Ground Despite Stronger Jobs Report

Mortgage Rate News - Fri, 05/03/2019 - 17:25
Mortgage rates were flat today, which is a victory considering the big jobs report was stronger than expected. Typically, labor market strength--especially when seen in this particular report--is bad news for rates, but it didn't happen today. In fact, after a brief initial reaction, the underlying bond market actually improved (which is consistent with slightly lower rates, but it didn't improve quite enough for the average lender to go to the trouble of making that change today). What's up with the paradoxical reaction? Two factors could be in play. First, bonds have spent the past two days moving higher in rate following Jerome Powell's press conference. The rebound in rates seen today could be more of a technical correction to those two days of pain. Beyond that, if markets are actually
Categories: Mortgage News

Mortgage Rates Are Actually Higher This Week

Mortgage Rate News - Thu, 05/02/2019 - 17:37
Mortgage rates didn't move much today, but the average lender is quoting microscopically higher rates, if anything. Week-over-week, it wouldn't be unfair to claim that rates are slightly lower. Today's average news coverage suggests the same due to the weekly release of Freddie Mac's mortgage rate survey. Freddie says rates dropped a whopping 0.05%. While that may be true if we strictly compare Monday/Tuesday of last week to the same 2 days this week (which is essentially what Freddie's methodology does), we're currently in slightly WORSE shape (i.e. higher) compared to the end of last week. The best case to be made is that rates have generally been flat, and not much higher than they were last Friday. All that could change tomorrow following two very important economic reports set to be released
Categories: Mortgage News

Mortgage Rates Inch Lower, But Remain Generally Sideways This Week

Mortgage Rate News - Wed, 05/01/2019 - 17:01
Mortgage rates finally moved in a direction that wasn't "up" today. That said, it's debatable whether the direction would be best described as "lower" or "sideways." To those who don't check in with rates too often or who aren't excited by saving a couple hundred bucks in closing costs, rates are sideways. But for those for whom every little bit counts, the today's upfront costs would be slightly lower than yesterday's for any given interest rate quote. The upfront cost portion of a loan quote offers lenders more of a fine-tuning adjustment compared to changing actual rates, which tend to be offered in 0.125% increments. Markets typically don't move enough in a single day for a 0.125% change in rates. Upfront costs help adjust lender/borrower costs in those cases. Despite the relatively flat
Categories: Mortgage News

Mortgage Rates Continue Higher Despite Bond Market Gains

Mortgage Rate News - Tue, 04/30/2019 - 17:48
Mortgage rates moved up again today, despite modest improvement in the bond market (which typically coincides with lower rates). Part of the reason for the counter-intuitive behavior is timing. Bonds lost ground yesterday afternoon. This implied higher rates, but many lenders didn't end up changing their mortgage rates. That meant the average lender began the day with a handicap. Moreover, today's bond market improvement didn't show up until a few hours into the morning. Also at issue is the occasional discrepancies we see between broader bond markets and those that underlie mortgage rates. It's a common misconception that 10yr Treasury yields determine mortgage rate movement on any given day. That's only MOSTLY true, and even then, it's more like they are supplementary investments that simply
Categories: Mortgage News

Mortgage Rates Modestly Higher, But Volatility Could Increase

Mortgage Rate News - Mon, 04/29/2019 - 17:58
Mortgage rates moved up today, but at a fairly tame pace in the bigger picture. The rest of the week, however, may not be as tame. There are multiple economic reports on tap with a history of impacting the bond market (which dictates rates). The data gets most serious starting on Wednesday and finally culminates with 2 reports on Friday morning, one of which is the big jobs report. But economic data isn't the only thing that interest rates will need to worry about this week. Remember how Wednesday was a big day? That's because it will also play host to the latest official policy announcement from the Fed. Historically, the Fed announcements have been most interesting and relevant due to the risk that they would hike/cut rates or comment on the likelihood of future hikes/cuts. Things are a bit
Categories: Mortgage News

Mortgage Rates Are Actually a Bit Lower This Week

Mortgage Rate News - Thu, 04/25/2019 - 17:05
Mortgage rates held fairly steady today with the average lender unchanged to just slightly higher on the day. That's fairly good news considering yesterday marked the lowest rates in more than a week. Despite these facts, anyone searching the internet for mortgage rate news today is likely to encounter convincingly-worded articles claiming that rates are HIGHER this week. So which one of us is lying to you? In fact, no one is lying. This is something that runs the risk of happening on any given Thursday when Freddie Mac releases its weekly mortgage rate survey. For whatever reason, their survey methodology only solicits responses on Monday-Wednesday. Moreover, based on years of review of Freddie's surveys and actual lender rate sheets, the heaviest weight is given to Monday and almost no weight
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Mortgage Rates Drop to Lowest Levels in More Than a Week

Mortgage Rate News - Wed, 04/24/2019 - 17:14
Mortgage rates moved lower at their best pace in several weeks today, with the average lender making it back to levels not seen since April 12th. The gains were bigger than normal for two reasons. First, bond markets had improved slightly yesterday afternoon, but not enough for lenders to adjust their rate sheet offerings for the better. Thus, they had to play a bit of catch-up with this morning's rate sheets. The bigger factor was the additional bond market strength seen throughout the overnight trading session and well into the domestic trading hours. In general, bond market "strength" means that bond prices are moving higher and bond yields (or "rates") are moving lower . Whereas trading values in the bond market change frequently throughout the day, the average mortgage lender tries to
Categories: Mortgage News

Mortgage Rates Move Up Despite Market Gains

Mortgage Rate News - Tue, 04/23/2019 - 16:13
When bonds make "gains," it means that bond prices are moving up. The price of a bond is like the amount that a lender is willing to pay for the right to collect a certain amount of interest. The more the lender is willing to pay, the lower that lender's "yield" will be. Looked at another way, the lower your interest rate would be in the case of a lender making you a mortgage loan. For that reason, we expect to see mortgage rates fall when bonds are making gains (mortgages are based primarily on bond prices/yields). But in today's case, rates went a bit higher even though bonds improved. As is often the case, the discrepancy results from the timing of bond market movement over the past few days. Bonds weakened yesterday and rates logically moved higher. The catch is that bonds continued to
Categories: Mortgage News

Mortgage Rates Modestly Higher to Start The Week

Mortgage Rate News - Mon, 04/22/2019 - 17:40
Mortgage rates were higher again on Monday, but just barely. The average lender was still in worse shape on Tuesday or Wednesday of last week when rates were the highest they'd been in about a month. Rates reflect demand in the bond market. Bonds can be bought or sold for a variety of reasons, but one of the key reasons is the general levels of fear and optimism surrounding the economy. When investors are less certain about positive economic outcomes, they tend to buy more bonds. This results in rates moving lower. That sort of uncertainty reached a bit of a boiling point at the end of March when the Fed called out economic uncertainty in Europe and China as one of the biggest risks to the global economic outlook. Since then, however, some of the data suggests the sky may not be falling just
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