Listen to this week's edition of Lykken on Lending for the latest mortgage rate and market updates.http://lykkenonlending.com/2017-11-27-podcast-market-update-with-joe-farr/
A stronger than expected Employment report on March 6 pushed mortgage rates up to the highest level of 2015. Since then, however, nearly all of the news, both globally and in the US, has been favorable for mortgage rates. In Europe, the European Central Bank (ECB) began its sovereign bond purchase program on March 9. The added demand from the ECB has helped push bond yields lower around the world. In addition, Greek and eurozone officials have made little progress in agreeing to terms for the Greek aid package. This caused investors to shift to safer assets, including US mortgage-backed securities. In the US, the major economic data released since the Employment report has been weaker than expected. Retail Sales, Industrial Production, and Housing Starts all have fallen well short of the consensus. Since slower growth reduces expectations for future inflation, this economic data has been good for mortgage rates. Finally, the largest improvement in mortgage rates took place on Wednesday after the release of the Fed statement. Fed officials downgraded their outlook for the economy and inflation, causing investors to push back their expectations for the timing of federal funds rate hikes.
The Ability-to-Repay (ATR) and the Qualified Mortgage (QM) rules are in effect as of January 10. It seems a little late, but yesterday a Subcommittee of the House Financial Services Committee held hearings to consider how the new rules will harm current and prospective homeowners. Representatives from the lending industry spoke about the limiting effect these rules will have on credit availability, especially on credit for low to moderate income borrowers. Committee members are considering proposed new laws to modify these rules.
Freddie Mac reported that average mortgage rates rose in the week through June 27, with 30-yrs hitting 4.46%, from 3.93% the prior week. This was the largest weekly increase in 26 years. While the survey results are released on Thursday, the timing of the data collection means that the data better reflects changes from Monday to Monday or Tuesday to Tuesday than Thursday to Thursday each week. The Primary Mortgage Market Survey (PMMS) is sent on Monday with a response due back by Wednesday. Most responses are completed and submitted on Monday or Tuesday. The responses are averaged and the results are released on Thursday. The survey results, therefore, reflect the average rate and points borrowers were being offered on Monday and/or early Tuesday. Changes in the market since Monday/Tuesday can make the published data misleading when compared to rates and points actually being offered on Thursday. This week, mortgage rates have improved substantially since the survey period earlier in the week. If the survey were conducted this morning, the results for 30-yr rates would be 20 to 25 basis points lower.
Here is the summary and podcast of this week’s BlogTalkRadio/Lykken on Lending with Dave Lykken and MBSQuoteline’s Joe Farr. MBS prices are up +6/32 this morning, well above prices earlier in the morning. Some investors have issued favorable price changes as a result. The move higher was not predicated on any certain economic announcement. Short term Treasury auctions were well received and continued concerns about the debt situation in Greece have helped MBS prices. Mortgage rates have been fairly flat over the last few weeks, although there has been some intraday volatility. Last week’s events included the Fed meeting and announcements of the two major inflation measures, CPI and PPI. The Fed meeting held no surprises and the inflation indicators showed that inflation is not a concern in the near term. With the passage of the Health Care reform bill over the weekend, focus in Congress may switch to the financial sector. Several significant bills are under consideration, which if passed will force fundamental changes on the industry. All the proposed legislation includes increased regulation and oversight. Included in proposed legislation is a requirement for origination companies to retain some of the risk on the loans they originate and included [...]
Here is the summary and podcast of this week’s BlogTalkRadio/Lykken on Lending with Dave Lykken and MBSQuoteline’s Joe Farr. Mortgage rates are unchanged from Friday and are basically unchanged from a week ago. Retail Sales was the only significant economic announcement made last week. Retail sales were much stronger than expected causing a brief drop in mortgage prices. The drop was reversed fairly quickly. The 10 yr and 30 yr Treasury auctions from last week were well received. They caused little movement in mortgage prices. The end of the Fed’s MBS purchase program is fast approaching and the market awaits the impact of the Fed’s exit. A few months ago their exit was expected to push mortgage rates significantly higher. Now it appears that the market has factored their exit in the prices paid for MBS and the end of the MBS purchase program will have little immediate impact on rates. Several factors contributed to the change in expectations, including less supply of MBS to absorb due to a slow down in originations, a steep yield curve making MBS an attractive investment, and the announcement that Fannie Mae and Freddie Mac will begin buying back about $200 billion in delinquent [...]
We took the week off from BlogTalkRadio this week to participate in the Lenders One Conference. MBSQuoteline is a preferred vendor to members of Lenders One and are proud to participate in this bi-annual conference. BlogTalk Radio Podcasts will resume on March 8.
Mortgage industry veteran, David Lykken, along with frequent guests, Alice Alvey, Joe Farr and Scott Sanderson provide up-to-the-minute information on interest rates, loan programs and “hot industry news related to the mortgage industry. http://www.blogtalkradio.com/lykken-on-lending/2010/02/08/weekly-mortgage-market-update