Surprise! It’s a strong Jobs Report

May’s Jobs Report came in much better than expected this morning with 2.51 million jobs ADDED vs the anticipated the 8.5 million jobs lost. Personally, this sounds too good to be true to me and I’m thinking that we’ll see corrections in the months to come…of course, I hope I’m wrong and that an economic (and health) recovery is here.

From Market Watch:

“The biggest payroll surprise in history, by a gigantic margin, likely is due to a wave of hidden rehiring. Businesses which let people go in large numbers in March didn’t need to post their intention to bring people back on. Indeed, they just needed to call/text/email. Still, it’s a mystery why ADP didn’t pick this up, and it contradicts the continuing claims numbers, up 3 million between the April and May survey weeks. One possibility is that many people let go during the lockdowns didn’t make a recorded unemployment claim, either because they thought they would not qualify, or because their filing was caught up in backlogs.” —Ian Shepherdson, chief economist at Pantheon Macroeconomic.

As I write this (7:53 am PST on June 5, 2020), the Dow is up 800 points. Good news for the stock markets and a surprisingly strong Jobs Report tend to negatively impact mortgage rates. I just repriced a refinance scenario for one of my clients that I quoted last night and the same scenario will now cost 0.25% more in points/fee. For example, if the loan amount is $400,000, it now cost $1,000 more in discount points for the same rate (as I write this post). Mortgage rates change constantly throughout the day and may change by the time I publish this post!

This chart is from Freddie Mac’s Prime Market Mortgage Survey, a weekly report that shows average mortgage rates from last week. NOTE: For current mortgage rates for your home located in Washington state, click here. This illustrates that last week rates bumped slightly higher, however are still VERY LOW.

 

Bottom line, if you have not yet refinanced, I highly recommend that you start a loan application asap. Part of the reason why mortgage rates are near the lowest in 50 years is because of what our economy has been going through due to the pandemic. Once we see real recovery and/or if we see inflation, mortgage rates will most likely trend higher.

If your home is located anywhere in Washington state, I can help you! Click here to start the refinance process or here to get a mortgage rate quote. A majority of the home owners I’m helping with refinances have not needed appraisals, depending on the loan programs and how strong their application is and many are dramatically dropping their mortgage payments. Please don’t miss out on this opportunity!

 

How does economic news impact mortgage interest rates?

Mortgage rates are based on bonds (mortgage backed securities) and are traded fairly similar as stocks. Investors tend to favor stocks over bonds as stocks tend to provide a better return. However, investors will opt for bonds over stocks when they are seeking safety when markets are tumultuous.  When the stock market is on a run, odds are mortgage rates may be moving higher as investors are selecting stocks over bonds. And when the stock market is tanking, mortgage rates tend to improve for the same reason. [Read more…]

Mortgage rates expected to trend higher following the October Jobs Report

Recruitment or Employment Issues Chalk Drawing

Yesterday morning, the Jobs Report was released with data for the month of October. The report gave an overall healthy picture of the economy and came in slightly stronger than expected with 161,000 jobs added in October and positive revisions made to August and September. [Read more…]

Mortgage rates remain low following the Jobs Report

This morning the August Jobs Report came in with slightly weaker data than expected with only 151k non-farm payroll jobs added.

Yesterday, Freddie Mac released their PMMS report showing the 30 year fixed conventional rate still hanging around (just below) 3.500%.

2016 09 01 pmms

If you’ve been contemplating refinancing, it could be time to get off your duff! If your home is located anywhere in Washington state, I’m happy to help you. Click here for a no-hassle mortgage rate quote.

PS: Our office will be closed on Monday for Labor Day. I hope you have a wonderful holiday weekend!

Mortgage rates trending higher (still very low)

Freddie Mac’s PMMS report was released this morning showing that mortgage rates are trending higher from the 3 year lows.

2016 June 2 Freddie Mac PMMS

The Prime Mortgage Market Survey is based on an average of last week’s conforming rates and reports that the 30 year fixed rate averaged 3.66 with 0.5 points for the week ending June 2, 2016. [Read more…]

What May Impact Mortgage Interest Rates this week: January 4, 2016

MortgagePorter-JobsReportWelcome to my first post of 2016! I hope you and yours had a wonderful New Year holiday.

This week may not seem like there is a lot in store for economic indicators that influence the direction of mortgage rates…however, Friday features this years first Jobs Report.

[Read more…]

Mortgage Rates trending higher after the Jobs Report

MortgagePorter-JobsReportThis morning’s Jobs Report came in much stronger than expected with 271,o00 new jobs added in October vs the 181,000 anticipated. Positive revisions were made for August and July. The unemployment rate remains at 5% and hourly wages saw their biggest year over year increase since 2009.

All this good news is not so good for mortgage interest rates. While it’s great for more jobs, less unemployment and higher wages, it translates to wage inflation. Inflation is the arch enemy of bonds and mortgage backed securities (bonds) are what mortgage rates are based on.

The strong Jobs Report also increases the odds of the Fed increasing the Fed Funds rate in December.

[Read more…]

What May Impact Mortgage Rates this Week: June 29, 2015

MortgagePorter-JobsReportMortgage backed securities are enjoying bump today with Greece back in the headlines. As I’m writing this post (9:25 am pst) the Dow  is down 229. This is a case where a bad news for the stock market = good news for mortgage rates.

[Read more…]