Market Insight, Mortgage News, Mortgage Rates

The Week Ahead for Mortgage Rates: October 22, 2012

October 22, 2012 by · Leave a Comment 

FOMC meets this week -- mortgage rates get volatileMortgage markets worsened last week as hope for a European economic rebound and stronger-than-expected U.S. economic data moved investors out of mortgage-backed bonds.

Mortgage rates all of types — conventional, FHA and VA — lost ground last week, harming home affordability in Dyer Indiana and reducing purchasing power nationwide.

Rising rates also thwarted would-be refinancing households hoping to time a market bottom.

Click here to see today’s mortgage rates.

The increase runs counter to Freddie Mac’s weekly Primary Mortgage Market Survey which showed the average 30-year fixed rate mortgage rate dropping 2 basis points to 3.37% nationwide.

This contradiction occurred because Freddie Mac’s weekly mortgage rate survey is conducted Monday through Wednesday, and because the majority of the surveyed banks reply to Freddie Mac on Tuesday.

As a consequence, Freddie Mac failed to capture this week’s mid-week movement that took mortgage bonds to a one-month worst. Access to Freddie Mac mortgage rates is for “prime” borrowers and requires payment of discount points plus closing costs.

Click here to see today’s mortgage rates.

This week, mortgage rates may rise again. There is a lot of news on which for Wall Street to trade, beginning with the week’s biggest story — the Federal Open Market Committee’s 2-day meeting scheduled for Tuesday and Wednesday.

At the FOMC’s last meeting, the Federal Reserve introduced a third round of quanitative easing (QE3). QE3 is a monetary program through which the Fed will work to keep mortgage rates low until the economy’s recovery is more complete.

The Fed is expected to announce no new stimulus in this, its seventh of eight scheduled meetings for 2012, however, mortgage rates are typically volatile in the hours after the FOMC adjourns.

Click here to see today’s mortgage rates.

New housing data is set for release this week, too.

Wednesday, the U.S. Census Bureau will release September’s tally of New Home Sales. Given the recent strength in Housing Starts and rising confidence among the nation’s home builders, New Home Sales may best analyst calls for 385,000 new home sold last month on a seasonally-adjusted, annualized basis.

Strength in housing has recently correlated with rising mortgage rates. The housing market’s forward-looking Pending Home Sales Index is released Thursday.

This is The Week Ahead for Mortgage Rates: October 22, 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!

Related Posts Plugin for WordPress, Blogger...
Be Sociable, Share!

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!

More Posts - Website

Follow Me:
TwitterFacebookLinkedInPinterest

  • What Is Your Home Worth in Northwest Indiana and the suburbs of Chicago Illinois?

Speak Your Mind

WelcomeHomeNWI.com