Custom Services
call 888 776 7285

Mortgage News Letter


Mortgage News Daily

Stellar Housing Data; Rates Inching Lower
Fri, 25 Sep 2020 20:06:52 GMT

Mortgage Rate Update Considering this week's generally positive drift in rates, we shouldn't expect lenders to get less busy any time soon. In recent weeks, there's been a sense that mortgage pricing seems just a little bit "off" compared to expectations. Those expectations are primarily derived from movement in the bond market. When bonds improve, rates tent to improve as well, but that wasn't reliably happening recently. One plausible hunch involves lenders being a bit more cautious with pricing until they have a clear sense of which loans will be subject to the new adverse market fee (not sure what that is? read THIS ). With each passing day, they can be more and more certain that new loans will indeed get hit with the fee and thus are able to tighten up margins (thus resulting in slightly ...read more

Mortgage Rates in Drift Mode
Wed, 23 Sep 2020 21:00:02 GMT

Mortgage rates didn't do much today. The average lender was effectively unchanged from yesterday. The same could be said yesterday, and the day before that, and so on and so on... The only major adjustment to rates in recent weeks has been the abrupt spike of roughly 0.15% that occurred for some lenders when they re-implemented the new adverse market fee. Not sure what that is? Get caught up HERE . The adverse fee will continue working its way through the industry in the coming weeks. No lender is immune. This presents a great opportunity to lock refinance loans if you have one in process with a lender who has yet to bring the fee back. Once the fee is back in play for every lender, we could see rates relax just a little--at least enough to notice. The rationale is that there's currently a ...read more

Refresher on The New Refi Fee and Its Effect on Mortgage Rates
Tue, 22 Sep 2020 21:41:29 GMT

Fannie Mae and Freddie Mac are the two government sponsored agencies that guarantee timely payment of principal and interest to the investors who front the money that finances the American mortgage market. This guarantee means that more investors are willing to participate and at more advantageous rates for homeowners. Naturally, not every mortgage is repaid perfectly. Sometimes, payments are missed. In more serious situations, loans can end in foreclosure, short sales, etc. In those cases, the housing agencies are there to act as a backstop ensuring investors are made whole. In order to foot that bill, Fannie and Freddie collect fees on loans that they guarantee. Shockingly, these are called guarantee fees (or guaranty fees" with a "Y" in the case of Fannie Mae). The mortgage industry and ...read more

Mortgage Rates Vary Widely--Nothing To Do With The Fed
Thu, 17 Sep 2020 21:15:17 GMT

Yesterday's policy announcement from the Federal Reserve had a chance to cause significant volatility for the bond market and the bond market is the chief ingredient in the mortgage rate equation. But this time around, the Fed didn't cause a measurable reaction in the mortgage market. I'm frequently asked whether mortgage rates are 0% since the Fed just kept rates at 0%. People hear a headline on the news or a radio soundbyte mentioning the words "Fed, rate, zero," and then assume the Fed just made some change that dropped rates to zero percent. After all why would there be so many news headlines about it if the Fed merely kept its policy rate unchanged?! It's a fair question in that sense, but understand that the Fed's rate decision will always make the news, even if the rate is the same as ...read more

What Will The Fed Do to Mortgage Rates?
Tue, 15 Sep 2020 22:03:12 GMT

What will the Fed do to mortgage rates ? This is actually a bit of a trick question . The Fed doesn't set mortgage rates. The Fed's policy rate applies to overnight loans between large financial institutions. The only way it directly influences mortgage rates is by serving as the basis for the PRIME rate. Home equity lines of credit (HELOCs) are often based on the Prime Rate. For all other mortgage rates, charting a connection to the Fed Funds Rate is significantly more challenging. Indeed, there are many examples of mortgage rates moving in the opposite direction. In other words, mortgage rates have often fallen after a Fed rate hike and vice versa. But the Fed Funds rate isn't the only aspect of Fed policy. It's in those other policy tools that we find much better correlation between Fed ...read more