The Bridgewaters, Massachusetts

The Mortgage Interest Rate Lock Advisory for Provincetown MA for December 30, 2009

Here are some of the events affecting mortgage interest rates today in Provincetown, MA.

What the Mortgage Backed Securities Market is Doing Today:

• The price of the FNMA 30-Year 4.5% MBS coupon opened at 100.03 this morning - up 6/32 from yesterday's close.
• The 4.5% MBS coupon is currently trading at 100.03 - the same as its opening.

Remember, on mortgage backed securities (MBSs), as the price goes up, the yield comes down - and mortgage interest rates come down with it. I expect that mortgage interest rates will essentially be the same in price this morning as compared to yesterday.

Economic Reports, News, and Events Affecting Mortgage Interest Rates Today

• There are no economic reports scheduled for release today.

In other news, the Feds will auction $32 billion in 7-Year Notes today; the results will be posted at 1 PM. The auction supply will weigh heavily on the bond and mortgage markets on mounting concern that demand from foreign central banks may lessen on concerns the US federal debt is too great. This could lead to higher mortgage interest rates.

Is the stock market rallying, or should we be bracing for a correction? Watch this video from CNBC to learn more:

What's Happening With Mortgage Interest Rates Today:

Moderate to High Volatility. As we saw last week, a shortened holiday trading week by no means translates into calmness in the mortgage market. The bond and mortgage markets will close early Thursday at 2 PM, and will be closed all day Friday in observance of New Years Day. This means that trades in mortgage backed securities will light today and tomorrow. This raises the possibility of stronger reactions to surprises in the mortgage market from economic data than we normally would see.

Mortgage interest rates are still at historic lows. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.

If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.

Price Trend in Mortgage Backed Securities:

The chart below shows the price trend of the FNMA 30-Year 4.5% coupon over the past 30 days from 11-30-2009 to 12-29-2009:

My Mortgage Interest Rate Lock Advice for Today:

If I were applying for a mortgage today or if I had already applied for a mortgage but have not yet locked in a rate, I would

• Float if my closing was taking place within the next 10 days


• Float if my closing was taking place between 11 and 30 days

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 any or all other borrowers.

Get today's mortgage interest rates for your situation in Provincetown, MA.

The Mortgage Interest Rate Lock Advisory for Truro MA for December 29, 2009

Here are some of the events affecting mortgage interest rates today in Truro, MA.

What the Mortgage Backed Securities Market is Doing Today:

The price of the FNMA 30-Year 4.5% MBS coupon opened at 99.50 this morning - down 2/32 from yesterday's close.

The 4.5% MBS coupon is currently trading at 99.62 - up 4/32 from its opening this morning. Remember, on mortgage backed securities (MBSs), as the price goes up, the yield comes down - and mortgage interest rates come down with it. I expect that mortgage interest rates will be essentially be the same in price this morning as compared to yesterday.

Economic Reports, News, and Events Affecting Mortgage Interest Rates Today

• Consumer Confidence Index (CCI) for December - came in at 52.9, slightly less than a reading of 53.0 that analysts were expecting, but is up from the 49.5 reading in November. Posted by the Conference Board, this measures consumer willingness to spend. Because consumer spending makes up two-thirds of the U.S. economy, any related data is watched closely by market traders and can have a significant influence on the mortgage market. If consumers are more confident in their personal financial situations, they are more apt to make large purchases. This CCI reading could lead to lower mortgage interest rates this morning.

In other news, the S&P/Case-Shiller® home price index tracks monthly changes in the value of residential real estate in 20 metropolitan regions across the U.S. The 20-index came in at 146.58 for October, barely more than the 146.51 reading in September. Home prices are down at an annualized rate of 7.3% vs. a 9.4% annualized rate of decline in September. This shows that price declines in homes continue to ease, but have not yet bottomed.

The Feds will auction $42 billion in 5-Year Notes today; the results will be posted at 1 PM. The auction supply will weigh heavily on the bond and mortgage markets on mounting concern that demand from foreign central banks may lessen on concerns the US federal debt is too great. This could lead to higher mortgage interest rates.

Are mortgage interest rates “ready to pop?” Watch this video from CNBC to find out:

What's Happening With Mortgage Interest Rates Today:

Moderate to High Volatility. As we saw last week, a shortened holiday trading week by no means translates into calmness in the mortgage market. The bond and mortgage markets will close early Thursday at 2 PM, and will be closed all day Friday in observance of New Years Day. This means that trades in mortgage backed securities will light during the latter part of the week. This raises the possibility of stronger reactions to surprises in the mortgage market from economic data than we normally would see.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. Mortgage interest rates are still at historic lows. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.

If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.

My Mortgage Interest Rate Lock Advice for Today:

If I were considering financing/refinancing a home, I would...

• Lock if my closing was taking place within the next 7 days
• Lock if my closing was taking place between 8 and 30 days
• Float if my closing was taking place between 31 and 45 days
• Float if my closing was taking place between 46 and 60 days

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 any or all other borrowers.

Get today's mortgage interest rates for your situation in Truro, MA.

The Mortgage Interest Rate Lock Advisory for Wellfleet MA for December 28, 2009

Here are some of the events affecting mortgage interest rates today in Wellfleet, MA.

What the Mortgage Backed Securities Market is Doing Today:

The price of the FNMA 30-Year 4.5% MBS coupon opened at 99.85 this morning - the same as Friday's close.

The 4.0% MBS coupon is currently trading at 97.54 - down 10/32 from its opening this morning. Remember, on mortgage backed securities (MBSs), as the price goes down, the yield goes up - and so do mortgage interest rates. I expect that mortgage interest rates will be 0.125% - 0.375% worse in price this morning as compared to Friday.

Economic Reports, News, and Events Affecting Mortgage Interest Rates Today:

• There are no economic reports scheduled for release today.

In other news, the Feds will auction $44 billion in 2-Year Notes today; the results will be posted at 1 PM. The auction supply will weigh heavily on the bond and mortgage markets on mounting concern that demand from foreign central banks may lessen on concerns the US federal debt is too great. This could lead to higher mortgage interest rates.

What's Happening With Mortgage Interest Rates Today:

Moderate to High Volatility. As we saw last week, a shortened holiday trading week by no means translates into calmness in the mortgage market. The bond and mortgage markets will close early Thursday at 2 PM, and will be closed all day Friday in observance of New Years Day. This means that trades in mortgage backed securities will light during the latter part of the week. This raises the possibility of stronger reactions to surprises in the mortgage market from economic data than we normally would see.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. Mortgage interest rates are still at historic lows. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.

If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.

My Mortgage Interest Rate Lock Advice for Today:

If I were considering financing/refinancing a home, I would...

• Lock if my closing was taking place within the next 7 days
• Lock if my closing was taking place between 8 and 30 days
• Float if my closing was taking place between 31 and 45 days
• Float if my closing was taking place between 46 and 60 days

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 any or all other borrowers.

Get the best available mortgage interest rates for your situation in Wellfleet, MA!

The Mortgage Market Watch for the Week of December 28, 2009

Events Affecting the Mortgage Market This Week:

The Feds will auction another $118 billion in Notes this week: $44 billion in 2-Year Notes on Monday, $42 billion in 5-Year Notes on Tuesday, and $32 billion in 7-Year Notes on Wednesday. The auction supply will weigh heavily on the bond and mortgage markets on mounting concern that demand from foreign central banks may lessen on concerns the US federal debt is too great. This could lead to higher mortgage interest rates.

It is also another holiday-shortened week with the New Years Day holiday. The bond and mortgage markets will close early Thursday and remain closed on Friday. Many traders will not be working the latter part of the week, so any unexpected news or data could lead to larger than usual reaction in the financial markets.

Economic Reports to be Released This Week:

There is only one economic report scheduled for release this week that could have an impact on the mortgage market and mortgage interest rates.

Monday, December 28th:

• There are no economic reports scheduled for release today.

Tuesday, December 29th:

• Consumer Confidence Index (CCI) for December - posted by the Conference Board, this measures consumer willingness to spend. Because consumer spending makes up two-thirds of the U.S. economy, any related data is watched closely by market traders and can have a significant influence on the mortgage market. If consumers are more confident in their personal financial situations, they are more apt to make large purchases. Analysts are expecting a reading of 53.0, up from November's reading of 49.5. Higher CCI readings could lead to higher mortgage interest rates.

Wednesday, December 30th:

• There are no economic reports scheduled for release today.

Thursday, December 31st:

• Jobless Claims - New claims for unemployment are tabulated each week to show the number of individuals who filed for unemployment insurance for the first time. With a decreasing trend in the filing of new claims for unemployment, this suggests that the labor market is improving. However, this data is usually not considered to be very important to the mortgage market.
  
  
  
• Fed's MBS Purchase Program - the results of this week's purchases of mortgage backed securities by the Feds will be released in the afternoon. As of last Thursday, the Feds have purchased over $1.070 trillion in mortgage backed securities this year. The Feds plan on purchasing up to $1.25 trillion in mortgage backed securities through March 31st.

Friday, January 1st:

• There are no economic reports scheduled for release today. The markets are closed in observance of New Years Day.

How do Economic Data Releases Affect Mortgage Interest Rates?

One of the most important things for you to know when deciding when to lock in the interest rate on your mortgage is knowing what economic data is going to be released - and when - and how it may impact the mortgage market and mortgage interest rates.

While an in depth review of an economic event can help you make an informed decision, understanding the nuances of a release can't help you if you don't know when it's happening. Economic data releases are important because they provide a snapshot of what's happening in the economy. They also provide a foreshadowing of any upcoming market volatility. It's just as important to know when these data releases are happening as knowing what effect these releases can have on the mortgage market.

Mortgage Interest Rate Outlook:

Moderate to High Volatility. As we saw last week, a shortened holiday trading week by no means translates into calmness in the mortgage market. The bond and mortgage markets will close early Thursday at 2 PM, and will be closed all day Friday in observance of New Years Day. This means that trades in mortgage backed securities will light during the latter part of the week. This raises the possibility of stronger reactions to surprises in the mortgage market from economic data than we normally would see.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. Mortgage interest rates are still at historic lows. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.

If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.

The Mortgage Interest Rate Lock Advisory for Eastham MA for December 24, 2009

Here are some of the events affecting mortgage interest rates today in Eastham, MA.

What the Mortgage Backed Securities Market is Doing Today:

The price of the FNMA 30-Year 4.5% MBS coupon opened at 100.06 this morning - the same as yesterday's close.

The 4.5% MBS coupon is currently trading at 99.97 - down 3/32 from its opening this morning. Remember, on mortgage backed securities (MBSs), as the price goes down, the yield goes up - and so do mortgage interest rates. I expect that mortgage interest rates will essentially be 0.0% - 0.125% worse in price this morning as compared to yesterday.

Economic Reports, News, and Events Affecting Mortgage Interest Rates Today

• Durable Goods Orders Report for November - increased 0.2%, less than the 0.5% increase that was expected, and follows a 0.6% decline in October. If order for Boeing aircraft are excluded, new durables orders increased 2.0%, following a 0.7% drop in October. This report provides us with an important measurement of manufacturing sector strength by tracking orders for big-ticket items or products that are expected to last at least three years. While the overall readings were weaker than expected, they did not have much impact on prices of mortgage backed securities this morning.
  
  
• Jobless Claims - there were 452,000 new claims for unemployment filed last week, less than the 470,000 new claims that were expected. The four-week average declined by 2,650 to 465,250. Continuing claims also declined, and fell by 127,000 to 5.076 million. With a decreasing trend in the filing of new claims for unemployment, this suggests that the labor market is improving. While this data is usually not considered to be very important to the mortgage market, the continuing improvement in the job market had led to a decline in prices of mortgage backed securities this morning (higher costs for mortgage interest rates).
  
  
• Fed's MBS Purchase Program - the results of this week's purchases of mortgage backed securities by the Feds will be released in the afternoon. As of last Thursday, the Feds have purchased over $1.070 trillion in mortgage backed securities this year. The Feds plan on purchasing up to $1.25 trillion in mortgage backed securities through March 31st.

In other news, the stock market will close at 1:00 PM this afternoon while the bond and mortgage markets close at 2:00 PM for the Christmas holiday.

Next week, the Feds will auction in another $118 billion in Notes: $44 billion in 2-Year Notes on Monday, $42 billion in 5-Year Notes on Tuesday, and $32 billion in 7-Year Notes on Wednesday. The auction supply will weigh heavily on the bond and mortgage markets on mounting concern that demand from foreign central banks may lessen on concerns the US federal debt is too great. This could lead to higher mortgage interest rates.

What's Happening With Mortgage Interest Rates Today:

Moderate Volatility - Mortgage interest rates are rising because of increasing fears of inflation. The sentiment is the health care bill will add hundreds of billions of dollars more to the already massive federal deficits. There's increasing concerns that the Fed will have to begin increasing short term interest rates and tighten monetary policy sooner than later.

The bond and mortgage markets will close early today and will be closed all day tomorrow in observance of Christmas Day. This means that trades in mortgage backed securities will light today. This raises the possibility of stronger reactions to surprises in the mortgage market from economic data than we normally would see.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. Mortgage interest rates are still at historic lows. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.

If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.

My Mortgage Interest Rate Lock Advice for Today:

If I were considering financing/refinancing a home, I would...

• Lock if my closing was taking place within the next 7 days
• Lock if my closing was taking place between 8 and 30 days
• Float if my closing was taking place between 31 and 45 days
• Float if my closing was taking place between 46 and 60 days

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 any or all other borrowers.

Get today's mortgage interest rates for your situation in Eastham, MA.

The Mortgage Interest Rate Lock Advisory for Orleans MA for December 23, 2009

Here are some of the events affecting mortgage interest rates today in Orleans, MA.

What the Mortgage Backed Securities Market is Doing Today:

The price of the FNMA 30-Year 4.5% MBS coupon opened at 100.06 this morning - the same as yesterday's close.

The 4.5% MBS coupon is currently trading at 100.25 - up 6/32 from its opening this morning. Remember, on mortgage backed securities (MBSs), as the price goes up, the yield comes down - and mortgage interest rates come down with it. I expect that mortgage interest rates will be 0.00% - 0.125% better in price this morning as compared to yesterday.

Economic Reports, News, and Events Affecting Mortgage Interest Rates Today:

• Personal Income and Outlays data for November - there was a 0.4% increase in income, more than October, and a 0.5% increase in spending, less than October. However, both are slightly less than expected. Analysts expected a 0.5% increase in income and a 0.6% increase in spending. This report provides us with a measurement of the consumer's ability to spend and their current spending habits. Because consumer spending makes up two-thirds of the U.S. economy, any related data usually has an impact on the mortgage market and mortgage interest rates. However, because the readings came in largely as expected, there was little impact on mortgage backed securities and mortgage interest rates this morning.
  
  
• The Revised University of Michigan Index of Consumer Sentiment for December - came in at 72.5, slightly less than the reading of 73.5 that analysts were expecting - and down from the preliminary reading of 73.4. An increase in consumer confidence indicates that consumers may be more apt to make large purchases in the near future. Because the readings came in largely as expected, there was little impact on mortgage backed securities and mortgage interest rates this morning.
  
  
• New Home Sales Report for November - new home sales plunged 11.3% in November. New home sales fell to an annualized rate of 355,000. Analysts expected the report to show an increased in new home sales to an annualized rate of 440,000. In October, new homes sold at an annualized rate of 430,000. This report provides us with another measurement of housing sector strength and mortgage credit demand. However, this data usually does not have an impact on the mortgage market.

In other news, the Treasury Dept. will announce later this morning the auctions of $118 billion in 2-Year Notes, 5-year Notes, and 7-Year Notes for next week. The ever increasing supply of Notes and Bonds continues to weigh heavily on the markets. Central bankers in China state the US cannot continue to count on foreign investors to fund the massive federal deficits.

What's Happening With Mortgage Interest Rates Today:

Moderate to High Volatility - Mortgage interest rates are rising because of increasing fears of inflation. The sentiment is the health care bill will add hundreds of billions of dollars more to the already massive federal deficits. There's increasing concerns that the Fed will have to begin increasing short term interest rates and tighten monetary policy sooner than later.

The bond and mortgage markets will close early Thursday and will be closed all day Friday in observance of Christmas Day. This means that trades in mortgage backed securities will light during the latter part of the week. This raises the possibility of stronger reactions to surprises in the mortgage market from economic data than we normally would see.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. Mortgage interest rates are still at historic lows. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.

If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.

My Mortgage Interest Rate Lock Advice for Today:

If I were considering financing/refinancing a home, I would...

• Lock if my closing was taking place within the next 7 days
• Lock if my closing was taking place between 8 and 30 days
• Float if my closing was taking place between 31 and 45 days
• Float if my closing was taking place between 46 and 60 days

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 any or all other borrowers.

Get today's mortgage interest rates for your situation in Orleans, MA.

The Mortgage Interest Rate Lock Advisory for Chatham MA for December 22, 2009

Here are some of the events affecting mortgage interest rates today in Chatham, MA.

What the Mortgage Backed Securities Market is Doing Today:

Prices of Mortgage Backed Securities Continue Free Fall in Massive Sell Off
Mortgage Interest Rates Are Rising - and Fast!

The price of the FNMA 30-Year 4.5% MBS coupon opened at 100.56 this morning - the same as yesterday's close.

The 4.5% MBS coupon is currently trading at 100.06 - down 16/32 from its opening this morning. Remember, on mortgage backed securities (MBSs), as the price goes down, the yield goes up - and so do mortgage interest rates. I expect that mortgage interest rates will be 0.125% - 0.375% worse in price this morning as compared to yesterday.

Economic Reports, News, and Events Affecting Mortgage Interest Rates Today:

• Final Revision to the 3rd Quarter GDP - the economic recovery is not as strong as earlier believed. GDP grew at an annualized rate of 2.2% in the 3rd quarter, less than expected. Analysts expected the GDP report to show an annualized growth rate of 2.7%. Last month's first revision showed that the economy expanded at a 2.8% annualized rate. This data usually does not have an impact on the mortgage market unless it varies greatly from forecasts.
  
  
• Existing Home Sales Report for November - existing home sales jumped 7.4% to an annualized rate of 6.54 million, the best since February 2007, and much more than expected. Analysts expected the report to show an annualized rate of 6.25 million. In October, existing homes sold at an annualized rate of 6.10 million. Released by the National Association of Realtors (NAR), this report will provide us with a measurement of housing sector strength and mortgage credit demand. This data usually does not have an impact on the mortgage market; however, mortgage interest rates continued rising this morning on the news.

Moderate to High Volatility - Mortgage interest rates are rising because of increasing fears of inflation. The sentiment is the health care bill will add hundreds of billions of dollars more to the already massive federal deficits. There's increasing concerns that the Fed will have to begin increasing short term interest rates and tighten monetary policy sooner than later.

The bond and mortgage markets will close early Thursday and will be closed all day Friday in observance of Christmas Day. This means that trades in mortgage backed securities will light during the latter part of the week. This raises the possibility of stronger reactions to surprises in the mortgage market from economic data than we normally would see.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. Mortgage interest rates are still at historic lows. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.

If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.

My Mortgage Interest Rate Lock Advice for Today:

If I were considering financing/refinancing a home, I would...

• Lock if my closing was taking place within the next 7 days
• Lock if my closing was taking place between 8 and 30 days
• Lock if my closing was taking place between 31 and 45 days
• Lock if my closing was taking place between 46 and 60 days

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 any or all other borrowers.

Get today's mortgage interest rates for your situation in Chatham, MA.

The Mortgage Interest Rate Lock Advisory for Brewster MA for December 21, 2009

Here are some of the events affecting mortgage interest rates today in Brewster, MA.

What the Mortgage Backed Securities Market is Doing Today:

The price of the FNMA 30-Year 4.0% MBS coupon opened at 98.48 this morning - the same as Friday's close.

The 4.0% MBS coupon is currently trading at 97.88 - down 20/32 from its opening this morning. Remember, on mortgage backed securities (MBSs), as the price goes down, the yield goes up - and so do mortgage interest rates. I expect that mortgage interest rates will be 0.25% - 0.50% worse in price this morning as compared to Friday.

Economic Reports, News, and Events Affecting Mortgage Interest Rates Today:

• There are no economic reports scheduled for release today.

What's Happening With Mortgage Interest Rates Today:

Moderate to High Volatility. Overall, I am expecting to see some movement in the mortgage market and mortgage interest rates this week, but nothing drastic unless we get some surprising results from the week's data.

The bond and mortgage markets will close early Thursday and will be closed all day Friday in observance of Christmas Day. This means that trades in mortgage backed securities will light during the latter part of the week. This raises the possibility of stronger reactions to surprises in the mortgage market from economic data than we normally would see.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. Mortgage interest rates are still at historic lows. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.

If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.

My Mortgage Interest Rate Lock Advice for Today:

If I were considering financing/refinancing a home, I would...

• Lock if my closing was taking place within the next 7 days
• Lock if my closing was taking place between 8 and 30 days
• Float if my closing was taking place between 31 and 45 days
• Float if my closing was taking place between 46 and 60 days

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 any or all other borrowers.

Get the best available mortgage interest rates for your situation in Brewster, MA!

The Mortgage Market Watch for the Week of December 21, 2009

Events Affecting the Mortgage Market This Week:

We can expect very thin trading this week because of the Christmas holiday. We may see a larger reaction in the mortgage market than normal to some news because there will be fewer traders working and less transactions being made.

Economic Reports to be Released This Week:

There are 6 economic reports scheduled for release this week that could have an impact on the mortgage market and mortgage interest rates.

Monday, December 21st:

• There are no economic reports scheduled for release today.

Tuesday, December 22nd:

• Final Revision to the 3rd Quarter GDP - analysts are expecting the report to show that the GDP grew at an annualized rate of 2.7%. Last month's first revision showed that the economy expanded at a 2.8% annualized rate. This data usually does not have an impact on the mortgage market unless it varies greatly from forecasts.
  
  
  
• Existing Home Sales Report for November - released by the National Association of Realtors (NAR), this report will provide us with a measurement of housing sector strength and mortgage credit demand. Analysts are expecting the report to show an increased in existing home sales to an annualized rate of 6.25 million. In October, existing homes sold at an annualized rate of 6.10 million. This data usually does not have an impact on the mortgage market unless it varies greatly from forecasts.

Wednesday, December 23rd:

• Personal Income and Outlays data for November - this report provides us with a measurement of the consumer's ability to spend and their current spending habits. Analysts are expecting the report to reveal a 0.5% increase in income, and a 0.6% increase in spending. Because consumer spending makes up two-thirds of the U.S. economy, any related data usually has a impact on the mortgage market and mortgage interest rates. If this report reveals stronger than expected readings, we should see prices of mortgage backed securities fall and mortgage interest rates rise.
  
  
• The Revised University of Michigan Index of Consumer Sentiment for December - analysts are expecting a reading of 73.5 - a slight upward revision from the preliminary reading of 73.4. An increase in consumer confidence indicates that consumers may be more apt to make large purchases in the near future. An upward revision to the consumer sentiment index could lead to slightly higher mortgage interest rates.
  
  
• New Home Sales Report for November - this report will provide us with another measurement of housing sector strength and mortgage credit demand. Analysts are expecting the report to show an increased in new home sales to an annualized rate of 440,000. In October, new homes sold at an annualized rate of 430,000. This data usually does not have an impact on the mortgage market unless it varies greatly from forecasts.

Thursday, December 24th:

• Durable Goods Orders Report for November - this report provides us with an important measurement of manufacturing sector strength by tracking orders for big-ticket items or products that are expected to last at least three years. Analysts are expecting the report to show a 0.5% increase in new orders. There was a 0.6% decline in October. If this report reveals stronger than expected readings, we should see prices of mortgage backed securities fall and mortgage interest rates rise.
  
  
• Jobless Claims - New claims for unemployment are tabulated each week to show the number of individuals who filed for unemployment insurance for the first time. Analysts are predicting that 470,000 new claims for unemployment will have been filed last week. With a decreasing trend in the filing of new claims for unemployment, this suggests that the labor market is improving. However, this data is usually not considered to be very important to the mortgage market.
  
  
• Fed's MBS Purchase Program - the results of this week's purchases of mortgage backed securities by the Feds will be released in the afternoon. As of last Thursday, the Feds have purchased over $1.070 trillion in mortgage backed securities this year. The Feds plan on purchasing up to $1.25 trillion in mortgage backed securities through March 31st.

Friday, December 25th:

• There are no economic reports scheduled for release today. The markets are closed in observance of Christmas Day.

How do Economic Data Releases Affect Mortgage Interest Rates?

One of the most important things for you to know when deciding when to lock in the interest rate on your mortgage is knowing what economic data is going to be released - and when - and how it may impact the mortgage market and mortgage interest rates.

While an in depth review of an economic event can help you make an informed decision, understanding the nuances of a release can't help you if you don't know when it's happening. Economic data releases are important because they provide a snapshot of what's happening in the economy. They also provide a foreshadowing of any upcoming market volatility. It's just as important to know when these data releases are happening as knowing what effect these releases can have on the mortgage market.

Mortgage Interest Rate Outlook:

Moderate to High Volatility. Overall, I am expecting to see some movement in the mortgage market and mortgage interest rates this week, but nothing drastic unless we get some surprising results from the week's data.

The bond and mortgage markets will close early Thursday and will be closed all day Friday in observance of Christmas Day. This means that trades in mortgage backed securities will light during the latter part of the week. This raises the possibility of stronger reactions to surprises in the mortgage market from economic data than we normally would see.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. Mortgage interest rates are still at historic lows. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.

If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.

Early on after the real estate bubble burst the home loans that went bad were largely subprime and the general feeling then was that the defaults would pretty much stay in this particular segment. Lo and behold, slowly the Alt-A type of mortgage, once thought to be on really solid footing, started feeling the heat, too. The avalanche didn't stop there either. Defaults are now hitting the luxury homes that were supposed to somehow bypass the wrath of the mortgage gods, at least that's what many industry observers believed.

Mortgage payments on roughly 12% of loans over $1 million nationwide were 90 days or more past due in September, reports First American CoreLogic, Inc. a California research shop. Let's compare that to some other numbers. For home loans under $250,000 the corresponding figure was 6.3%, about half less. For every mortgage around it stood at 7.4%. One more. In September of 2008 it was 4.7% for mortgages north of $1 million. In short, in one year the figure has nearly tripled and that is mildly alarming.

Las Vegas valley - with communities like Summerlin, Anthem, Southern Highlands, Mountains Edge, Lake Las Vegas, Spanish Trail and Canyon Gate - luxury homes probably have even higher default rate due to the serious downturn of the once-booming housing market. Parts of Arizona, California and Florida, at least them, are other areas similarly affected. No market segment obviously is immune to the economic forces of the real estate collapse.

Many high-end homeowners have resorted to short sales to deal with the issue, so long as the mortgage lender goes along with the plan. It can be a tricky proposition, however. Let's say a nice mansion has a mortgage of $1.5 million on it and now the price is only $900,000, a 40% drop. The property is gloriously underwater. The bank would have to take a bath to the tune of $600,000, if sold like that. That's tough to swallow all in one shot. In comparison, a house with a $300,000 mortgage that is 40% underwater would be sold for $180,000, amounting "only" to a $120,000 write-off. Big, big difference for the mortgage lender.

When things fail to work out some homeowners decide to tiptoe away in the thick of night from the property, becoming a so-called strategic default, or a walkaway. These terms really have been absent from the everyday real estate vocabulary up until recently. Now they are being talked about from coast to coast over micro beers and at water coolers, and in high places, too, as it is becoming a growing pain for those dwelling in corner offices with a view.

Jumbo mortgage defaults will keep banks that have a bunch of them in their hack-proof electronic ledgers in a precarious position for a while. Some will never make it, some will do so over a long, painful stretch of time. Overall, it'll limit mortgage liquidity and prolong a true recovery. But, it also could be the end of the default cycle that kicked off with the subprime product. If so, then after this latest mess is sorted out the mortgage and housing markets can begin rising from the fog of misery to once again become power players in the national economy. Can't wait.