Market Insight, Mortgage News, Mortgage Rates

The Week Ahead for Mortgage Rates: April 23, 2012

April 23, 2012 by · 1 Comment 

FOMC meets this weekMortgage markets were mostly unchanged last week, breaking a three-week winning streak. Wall Street grappled with surprising demand on Spain’s debt issuance and a series of weaker-than-expected data points on U.S. housing.

Conforming mortgage rates across Northwest Indiana and suburbs of Chicago Illinois rose slightly according to the weekly Freddie Mac Primary Mortgage Market Survey.

Nationwide, the 30-year fixed rate mortgage rate climbed 2 basis points to 3.90%. This rate is available to homeowners willing to pay 0.8 discount points and a full set of closing costs, where 1 discount point is equal to 1 percent of the borrowed amount.

Prior to last week’s survey, just 0.7 discount points were required.

Click here to see today’s mortgage rates.

This week, mortgage rates are expected to be volatile. There is a lot of economic data due for release, the Eurozone’s issues with sovereign debt remain unresolved, and the Federal Open Market Committee gets together for a scheduled, 2-day meeting.

In regards to key economic data, the week starts with Tuesday’s Consumer Confidence figures and the government’s New Home Sales report. Both have the power to move mortgage rates. The week then concludes with the Pending Home Sales Index; the GDP release; and a series of Treasury auctions.

With respect to Europe, demand remains strong for debt from Spain, but at much higher rates as compared to several weeks ago. The same is true for Italy. Both nations are feared to be at risk of default on their respective sovereign debt. It’s a similar situation to that which occurred in Greece throughout 2011.

Long-term, lingering concerns for Spain and Italy would likely help keep U.S. mortgage rates suppressed.

Click here to see today’s mortgage rates.

Lastly, the Federal Reserve will make a statement to markets Wednesday afternoon. The Fed is the nation’s central banker and its post-meeting press releases have tremendous influence on bond markets, including those for mortgage-backed bonds.

By extension, therefore, the Federal Reserve’s statement has the power to move mortgage rates in and around Northwest Indiana and suburbs of Chicago Illinois.

If you’re shopping for mortgage rates, it’s as good of a time as any to lock with your lender. Rates have more room to rise than to fall.

This is The Week Ahead for Mortgage Rates: April 23, 2012.

Click here to see today’s mortgage rates.

Quick general rule of thumb when keeping an eye on mortgage rates.

Strong Economic News: $$$ from Bonds —> Stocks = Home Loan Rates Go Up

Weak Economic News: $$$ from Stocks —> Bonds = Home Loan Rates Go Down

If you or someone you know is thinking about buying a home, the combination of low home loan rates and affordable home prices make this an ideal time to buy a home. Want to know if you can afford a new home? Call or text me at 512-522-7284 to discuss your personal situation and your home loan options!

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James K Barath, CMPS®

James K Barath is a Certified Mortgage Planning Specialist®, Certified FICO® Professional, Certified Military Housing Specialist® and your FHA Home Loan Expert. He is also a graduate of Purdue University, The CMPS Institute, Dale Carnegie Human Relations Course & Napoleon Hill Foundation's PMA Science of Success Class. It's your home and your future. It's his profession and his passion. He is ready to work for your best interest. Contact James for your FREE Home Loan Approval !  His Motto: I Facilitate the American Dream Through Responsible Mortgage Lending and Financial Literacy!

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Comments

One Response to “The Week Ahead for Mortgage Rates: April 23, 2012”
  1. I commented last week that I was worried about rising rates, and this report only serves to confirm my suspicions. Remember the 70s and 80s? Reverse situation, but everyone was thinking rates could just NEVER drop into the single digits – yet they did. A couple of years ago, people were thinking we’d be sitting in the 2’s and 3’s for a long time, yet here we are. I think that people who are relatively ready to buy should go ahead and nab up these still-rock-bottom rates while they can. I don’t necessarily think things will stay stable until 2014 like so many predict.

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