National Mortgage Rates Report: July 7, 2008

National mortgage rates for July 7, 2008. Loan amounts up to $417,000:

3/1 ARM 5.250%
5/1 ARM 5.500%
7/1 ARM 5.750%
10/1 ARM 6.000%
30 Yr Fixed 6.375%

All rates offered to the borrower with 1 point cost. Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification. Rates are subject to fluctuation. Custom rate quotes and rate lock advice are available by calling at the number below. read more

Posted by Brian J. Brady on Jul 07, 2008 under Mortgage Rates Reports

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Mortgage Rates Report: June 25, 2008

No recommendation until tomorrow. All eyes are on the Federal Reserve Open Market Committee today. At 2:15PM (EDT), 11:15 (PDT), they will release their interest rate decision and statement. The fixed income securities market believe there is a 43% chance that the Fed will RAISE rates to stifle inflation in August and that there is a 61% chance that the hike will come in November.

The eyes will be on the Fed’s commentary, though:

”We expect the Fed to keep the funds rate at 2% today but to shift to a more hawkish statement by placing more emphasis on inflation over growth risks,” strategists at Credit Suisse wrote in a research report. “The Fed will likely use this meeting as an opportunity to set the stage for a potential rate rise in August.”

If the Fed signals that rates could rise as early as August, expect mortgage rates to jump .25% higher, from today’s 6.375% 30 year fixed rate, over the next few weeks. If the Fed signals rate hikes are “possible” as a way to fight inflation, expect rates to stay read more

Posted by Brian J. Brady on Jun 25, 2008 under Mortgage Rates Reports

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National Mortgage Rates Report: June 12, 2008

Mortgage rates are headed higher. Lock all rates at application, regardless of closing date.

The trend is clear; the Fed believes it has done all it can to stave off the banking crises and is now focusing its efforts on inflation. This morning, retail sales were up and the dollar is strengthening. If stagflation is the fear, the current strategy of targeting core inflation may be abandoned for the more radical Paul Volcker-style approach to tame inflation.

While I believe the higher mortgage rate cycle will be shorter than the 80-s style interest rate hikes, it’s clear to me that Bernanke is talking differently than he did in 2006 and 2007.

The effect? We could see mortgage rates rise as much as 2% in the next two years. I still believe that a five year ARM will offer the best solution because interest rates move in cycles; I think we’ll see mortgage rates under 6% again in 2011. Today? The trend looks like we’re headed higher.

What then, should be your strategy? read more

Posted by Brian J. Brady on Jun 12, 2008 under Mortgage Rates Reports

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National Mortgage Rates Report: May 28, 2008

Mortgage rates jumped in the past 7 days because of rising oil prices. This is the staglationary fear I expected. Mortgage rates have increased to 6.0% (30 year fixed) today.

I expect mortgage rates to rise another .25% in the next 14 days for these reasons:

1. Possible uncertainty at the Federal Reserve Bank.
2. Oil above $125/barrel (which translates to $4/gal. gasoline at the pump)
3. Inflation affecting the European economy.

Bond traders hate uncertainty so we expect a lot of volatility through Labor Day. read more

Posted by Brian J. Brady on May 28, 2008 under Mortgage Rates Reports

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