It’s interesting to see how the markets react to “Fed Day” so I thought I’d do a “live post” today, updating this throughout the day with current mortgage rates.
Last week, rates bumped along 14 months lows. Those who were in position to lock with a mortgage application started, were able to secure low rates so they will be able to benefit from lower mortgage payments in the New Year. Before a lender locks in an interest rate, they need to have a complete application, including a credit report, so they know how to price the rate (low mid-credit scores are used) and if you actually qualify for the refi. It takes about 20 – 30 minutes to complete an on-line application, so if you are toying with refinancing right now, I highly recommend you contact your local lender (I can help you if your home is located in Washington state) so that you can be ready to lock in a very low mortgage rate.
This morning, Japan announced their GDP (gross domestic product) continues to decline, giving US mortgage bonds a slight boost. This week has a lot of economic indicators scheduled to be released that could impact the direction of mortgage rates. Keep an eye out for data that reveals inflation, as that will cause mortgage rates to trend higher.
Currently mortgage rates are continuing to improve (see below) compared to last week’s mortgage rate post.
Will this week bring tricks or treats with mortgage rates? The stage is set to be another volatile week for mortgage rates with scheduled economic events/indicators. The Fed is expected to retire QE3 this week, in which they were buying bonds and treasuries to keep mortgage interest rates at artificial low levels. In addition, the economic issues taking place in Europe and other uncertainties in the world, just adds to the drama we may see play out with mortgage rates.
I am going to attempt to write a “live post” today to illustrate how mortgage rates may change based on data that is released throughout the day and market reactions. Please keep in mind that despite my best efforts, sometimes a “live post” can be a bit challenging…we’ll give it a try!
This week is jam packed with data that may impact the direction of mortgage interest rates. Mortgage rates are based on bonds (mortgage backed securities) and are traded similar to stocks. Often times, mortgage rates will improve when we see the stock market taking a hit or rise when the stock market is rallying. This is because investors will trade the safety of bonds for the greater returns potentially found with stocks. The reverse is also true.