Mortgage Rates Hold Steady Despite Stock Rally
Posted 07-23-2010 at 08:57 AM by VictorBurek
After two losing days this week, mortgage rates managed a second day in a row of improved pricing. Despite a more than 200 point gain in stocks, mortgage backed securities only suffered a small price decline yesterday which allowed lenders to keep consumer borrowing costs unchanged on the day. However, the move lower in price will be reflected in rate sheets we receive this morning. Even though lenders improved pricing, consumer borrowing costs are still slightly higher than the all time lows set last Friday.
We have no economic data reporting today. Typically on days like today, the stock market has a greater impact on the bond market, termed the stock lever. If stocks move higher, benchmark treasuries and MBS will come under pressure to move lower.
Rate sheets this morning are priced slightly worse than what we had yesterday. There is no change to the par interest rate of 4.375% to 4.625% for well qualified consumers, but costs are .125%(of the loan amount) higher. As always, to secure a par interest rate on a conventional mortgage you must have a FICO credit score of 740 or higher, a loan to value at 80% or less and pay all closing costs including an estimated one point loan origination/discount/broker fee. If your credit is less than perfect or you need a higher loan to value, you should consider a FHA loan which offers similar rates but with higher costs.
The all time best rates were seen on Friday of last week. This morning’s rate sheets are only about .25% to .375% worse in price. With rates holding near all time lows, I continue to see no benefit in floating. The only loans I would float would be those closing in more than 30 days.
Have a great weekend, be back to you on Monday.
We have no economic data reporting today. Typically on days like today, the stock market has a greater impact on the bond market, termed the stock lever. If stocks move higher, benchmark treasuries and MBS will come under pressure to move lower.
Rate sheets this morning are priced slightly worse than what we had yesterday. There is no change to the par interest rate of 4.375% to 4.625% for well qualified consumers, but costs are .125%(of the loan amount) higher. As always, to secure a par interest rate on a conventional mortgage you must have a FICO credit score of 740 or higher, a loan to value at 80% or less and pay all closing costs including an estimated one point loan origination/discount/broker fee. If your credit is less than perfect or you need a higher loan to value, you should consider a FHA loan which offers similar rates but with higher costs.
The all time best rates were seen on Friday of last week. This morning’s rate sheets are only about .25% to .375% worse in price. With rates holding near all time lows, I continue to see no benefit in floating. The only loans I would float would be those closing in more than 30 days.
Have a great weekend, be back to you on Monday.
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