These days, every time I order a Greek salad, the feta cheese makes my stomach churn. I wonder if the Greek economic meltdown has something to do with it! Here’s our Mortgage Guy, Brian Cav, with his weekly Massachusetts mortgage rate report.
Mortgage Market
Brian Cav
Mortgage Rates have moved up from the 2010 lows that we had last week, this is largely because of the modest stock rally and investors getting out of risky investments, “flight to quality,” These Greece issues, which are spreading throughout Europe, should keep mortgage rates down thru the summer, and not to mention North Korea is threatening military action against South Korea. Is it time to refinance out of that ARM mortgage? Yes, because LIBOR is rising. It’s time to get an updated mortgage rate quote.
The 30 year conventional rate mortgage remains in the 4.75% to 5% range for well qualified borrowers. To get the best mortgage pricing 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 discount fee.
I am a huge fan of LOCKing in your mortgage interest rate right now. It would not matter to me if you were closing in one week or 60 days out. I would LOCK in immediately.
Inquire within for current Mortgage Interest Rates. [email protected] 617.771.5021
Economic Data
The bond market has moved lower following today’s 5-year Treasury Note auction. The stock markets have also given up a good portion of this morning’s early gains. Yesterday, the Dow was up 56 points after being up nearly 135 points earlier. The Nasdaq fell from earlier highs, and was up only 23 points. The bond market has extended yesterday morning’s losses, and was down 21/32. This will likely lead to an upward revision to this afternoon’s mortgage rates of approximately .125 – .250 of a discount point.
Yesterday’s economic data gave us mixed readings on the economy. The more important of the two was April’s Durable Goods Orders data that showed a 2.9% increase in new orders for big-ticket items last month. It also showed a sizable upward revision to March’s orders, indicating that the manufacturing sector was stronger than thought. However, if more volatile transportation related orders were excluded, we would have seen a 1.0% decline in orders. This was much weaker than expected, so overall the data can be considered neutral to slightly positive for the bond market and mortgage rates.
April’s New Home Sales data showed a much larger than expected increase in sales of newly constructed homes. This is negative for bonds, but the data usually has little influence on mortgage rates unless it varies greatly from forecasts. This report did show a sizable variance, but it appears that it is has not had much of an impact on today’s rates.
The first of two revisions to the 1st quarter Gross Domestic Product (GDP) will be released early tomorrow morning. The second revision to this report comes next month but isn’t expected to have much of an impact on the financial markets. The GDP is the sum of all goods and services produced in the U.S. and is considered to be the best indicator of economic growth. Last month’s preliminary reading revealed a 3.2% increase in the annual rate of growth. Analysts expect a slight upward revision to this reading with the consensus being a 3.3% rate of growth. If the upward revision is much stronger than expected, we may see the bond market react negatively and mortgage rates move higher.
FLOAT or LOCK
If I was closing on a Home Mortgage in the next 0 to 15 Days – LOCK
If I was closing on a Home Mortgage in the next 15 to 30 Days – LOCK
If I was closing on a Home Mortgage in the next 30 to 60 Days – LOCK
If I was closing on a Home Mortgage in the next 60+ LOCK
This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.
- Are you a possible Massachusetts First Time Homebuyer?
- Do you have a Real Estate client inquiring about current Mortgage Rates?
- Do you have any Refinancing questions?
- Should you be thinking about Refinancing out of your ARM (Adjustable Rate Mortgage)?
- Have your Real Estate clients been Pre Approved?
[email protected] 617.771.5021
Credit: Bloomberg, Yahoo Finance, Mortgage News, MBS Quoteline, WSJ, NY Times
