How Rates Move:
Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market. This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events. When MBS pricing goes up, mortgage rates or pricing generally goes down. When they fall, mortgage pricing goes up. Tracking these securities real-time is critical. For more information about the rate market, contact me directly. I’m among few mortgage professionals who have access to live trading screens during market hours.
Rates Currently Trending: Neutral
Rates last week remained the same. The overall improvement for last week for the MBS market was +4 basis points, which may mean mortgage pricing finished close to where it started.
This Week’s Rate Forecast: Neutral
The rate markets are in a neutral state, with the market technical indicators pointing to neutral as well. However we don’t expect mortgage pricing to worsen or improve much from here, but to show volatility based on a week full of economic data and overseas geopolitical events.
This Week’s Potential Volatility: High
There will be economic data later this week that is likely to have an effect on the bond market, and that overseas issues will play a strong role. Volatility will be high as the markets and mortgage pricing are likely to move on any overseas geopolitical news as well as jobs report data and the Federal Reserve’s Federal Open Market Committee meeting. Remember, there are always unforeseen events that may arise which are not expected. We’ll be keeping an eye on all breaking news related to mortgage pricing.
If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.
RateAlert’s Most Trusted Mortgage Lending Professionals:
Loan Professionals that subscribe to RateAlert Executive services have the training and market knowledge at their fingertips, along with live trading data during market hours to expertly help navigate the difficult and often times confusing process of understanding rate movements and which factors may cause volatility when considering whether or not to lock.
This commentary has been provided to you by the Mortgage Loan Originator (MLO) above because they thought you may find it interesting or helpful. The views and opinions offered do not necessarily represent the views of Christian Durland. Please contact Christian with any questions or to find out more about the information listed herein and how to work with Christian