Mortgage Rates September 23, 2013

Mortgage Rates after the Bernanke Announcement

Last week, Bernard Bernanke startled many by announcing that the Fed will not wind down their bond buying program right now. The program is part of an overall stimulus package geared at bringing back the national economy. The Fed’s purchase of these bonds over the last few years has driven mortgage rates to historic lows. The assumption that there would be a reduction in bond purchases has caused 30 year mortgage rates to spike upward over the last few months.

Surprisingly, Bernanke revealed the Fed will continue bond purchasers at the current pace. What happened and what does it mean to mortgage interest rates?

What would have happened if they reduced bond purchases?

According to Bankrate.com:

“The Fed could have caused rates to shoot up this week if it had announced the tapering of its bond-purchasing program.”

Why did the Fed decide not to start winding down bond purchases?

Moody’s Analytics reported that there were three reasons:

  1. Subpar economic data
  2. Tighter financial conditions
  3. Uncertainty surrounding fiscal policy

What does this mean to a buyer applying for a mortgage?

Those at Bankrate.com explain:

“For now, borrowers have dodged another spike in rates. The Fed’s announcement might even cause rates to drop in coming days, says Paul Edelstein, director of financial economics at IHS Global Insight.

‘Mortgage rates should fall back — not massively, but to some extent,’ he says.

That doesn’t mean homebuyers and homeowners should wait for lower rates, mortgage professionals say.

Eventually, once the Fed lets the mortgage market and the economy start walking on their own, rates will probably head back to the 5 percent or 6 percent range, says Scott Schang, manager for Broadview Mortgage Katella in Orange, Calif.”

When will the Fed begin winding down bond purchases?  

According to an article in the Wall Street Journal:

“Federal Reserve policy makers decided this week that the economy isn’t in the right place for them to start winding down their bond-buying program. By the time they meet in December, it might be.

The decision to not start winding down the bond-buying program now was close… The economy only needs to get a little bit better over the next few months for the central bank to get its nerve back. That should be an easy bar for the economy to clear.”

Bernanke himself has not ruled out that the Fed could still scale back the stimulus this year. He stated:

“If the data confirms our basic outlook, then we could move later this year.”

Bottom Line

Ed Conarchy, a mortgage planner at Cherry Creek Mortgage in Gurnee, IL had a great quote in the Bankrate article:

“Remember that rates go up like a rocket and fall like a feather.”

Still, Bankrate.com itself probably put it best: Grab the gift before it’s gone!

Questions about home loans? Give us or one of our preferred lenders a call today!

Steve Hill and Sandra Brenner
Best In Client Satisfaction
Windermere Real Estate
BrennerHill.com
call/text 206-769-9577

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Home Purchase June 4, 2013

Now Is The Time To BUY!

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Steve Hill and Sandra Brenner
Windermere Real Estate Seattle Northwest
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Mortgage, Rates, Payment, Interest May 23, 2013

Total Increase a Buyer May Pay if They Wait

Earlier in the week, we explained that experts have projected that U.S. home prices will appreciate by approximately 5% in 2013. We also revealed the Mortgage Bankers AssociationFannie Mae and the National Association of Realtors have all projected that the 30-year mortgage rate will be at least 4% by the end of 2013. If we assume that prices and interest rates will rise as projected, here is the monthly difference a buyer may pay if they wait a year.

Steve Hill and Sandra Brenner
Windermere Real Estate Seattle Northwest
206-769-9577

Mortgage, Rate, Interest, Home Buyer, May 22, 2013

Mortgage Rates Projected to Increase

The Mortgage Bankers AssociationFannie Mae and the National Association of Realtors have all projected that the 30-year mortgage rate will be at least 4% by the end of 2013. If we assume that rates will still be at 4% in twelve months, here is the difference a buyer will pay if they wait.

Steve Hill and Sandra Brenner, Windermere Real Estate Seattle-Northwest 206-769-9577

Mortgage Rates April 15, 2013

Mortgage Rates

This Week's Mortgage Rates Forecast
Risks Favor: FLOATING
Now that we are seeing a new trend in MBS performance, and technical signs point to short term interest rate stability, we can advise to float and see if we may experience some improvement.  Be careful though, there is a lot of economic data being released this week that will cause daily volatility.  So, let's recap:  mortgage interest rates will probably end the week where they began them, meaning that rates are pretty stable.  However, during the day, we may see volatility which means that rebate or loan pricing may be affected even though interest rates themselves remain unchanged.  On a $200k loan, a difference of .5005 in loan pricing or rebate is $1,000 in out of pocket costs.

So for this week, any consumers who are less than 7 days out from closing may want to just lock in the great rates we see.  Anyone more than that should watch the market with their mortgage loan originator and see if we may find even more improvement on the horizon.

BOTTOM LINE:  Improvements in rate will come grudgingly, but if the stock market recovery we've been waiting for finally happens, we may improve by about .125%. Want more information about mortgage rates?   Give us a call, Steve Hill and Sandra Brenner, Windermere Real Estate Seattle Northwest 206-769-9577.

Mortgage Rates April 8, 2013

This Week’s Mortgage Rates Forecast

Risks Favor: LOCKING

With the rocketing performance in the MBS (Mortgage Backed Securities) market, and the resulting improvement to rates, how can we possibly suggest to lock?  Simple, it's because of those exact reasons.  We have seen a sudden improvement in rates driven by economic data that was a surprise, as well as global news from Korea.  We now find the market in a situation that is poised for a reversal.  Just like a good gambler knows when to get up from the table, a smart consumer knows when it is a good time to take the deal that is on the table, and it appears that now is that time.

This week for any consumers who are less than 30 days from closing, you can float very cautiously because you have time to act and recover if we see a sudden reversal.  However anyone that is closing within the next couple of weeks should really consider locking, because the chance of seeing this rate improvement slip away is higher than the chances of seeing continued improvement.

BOTTOM LINE:  If you aren't closing for awhile, let's see what the market does and maybe we can see even a little bit more of an improvement.  However, if you are closing within the next couple of weeks, or you simply like the rates you're looking at now, lock in these low rates and don't look back.  

For more information regarding interest rates, give us a call, we have a couple of great lenders who can point you in the right direction.

Steve Hill and Sandra Brenner, Windermere Real Estate/FN Seattle – Northwest. 206-769-9577

                                  

Mortgage Rates and Home FInance November 12, 2012

Mortgage Rates Remain Deadlocked

Is It Time to Refinance?

Mortgage rates were unchanged this week as investors hedged their election bets.

The benchmark 30-year fixed-rate mortgage was unchanged at 3.57%, according to the Bankrate.com national survey of large lenders. The mortgages in this week's survey had an average total of 0.4 discount and origination points. One year ago, the mortgage index stood at 4.25%; four weeks ago, it was 3.59%.

The benchmark 15-year fixed-rate mortgage fell to 2.88% from 2.89%. The benchmark 5/1 adjustable-rate mortgage was unchanged at 2.72%.

Read on here: http://www.foxbusiness.com/personal-finance/2012/11/08/mortgage-rates-remain-deadlocked/#ixzz2BlxJqWTC

http://bit.ly/TzIMEO