Texas Mortgage Corner » Mortgage Backed Securities

Mortgage Markets Down a Smidgen

Tommy — Mon, 25 Jan 2010 17:41:33 +0000

Mortgage market is currently down 12 bps this morning, and equity markets are picking up the losses from last week.

Existing Home Sales report came in around 16% lower in December at 5.45M, a lot lower than the 6M expected.

The main thing in the news today is Ben Bernanke and his chances of a second term. From the way it looks, he will be reconfirmed as the Fed Chairman.

Tomorrow we have the Consumer Confidence report which should have some impact on rates, so I’d recommend floating any rate locks at the moment until tomorrow.

Rates Testing Support

Tommy — Wed, 23 Dec 2009 19:27:41 +0000

MBS very volatile today due to all the reports.

The New Home sales dropped 11.3% in November to 355K as opposed to the 438K that was expected, and while this helped MBS, the Treasury is now going to auction off $122B instead of the $118B that was expected, so this brought them back down.

If you have a new transaction in the works today, I’d go ahead and just lock it and play it safe.

Early MBS Rebounds

Tommy — Wed, 23 Dec 2009 14:44:09 +0000

Currently up 22 bps for the morning session, we’re seeing a little bounce back from yesterday’s losses. It’s still early so, I wouldn’t expect mortgage rates to open lower today, however, today is JAM PACKED with reports, and that could sway MBS in several directions.

Here’s what’s on the menu for today:

Personal Consumption Expenditures and Core PCE
Personal Income
Personal Spending
New Home Sales Nov
Consumer Sentiment Index (UoM)
Crude Inventories

We can’t stress enough how important it is to work with a mortgage professional that has a finger on the pulse of what is going on and how it affects YOUR WALLET.

Stay tuned for any updates- I’m sure there will be several today.

Morning Market Update

Tommy — Thu, 10 Dec 2009 14:58:20 +0000

Down 25 bp already this morning (meaning rates have opened higher this morning). Stock market has opened up higher as well which proves ONE of the factors that lead to mortgage rates increases.

This proves a very interesting point, and creates a general “rule-of-thumb” that shows the correlation between stocks and bonds.

To sum it up, mortgage rates usually get better if Nasdaq sells off (stock market goes down) and will get worse if the Nasdaq rallies (stock market goes up).

This is because money managers and mutual fund companies typically keep funds in either stocks or bonds with very little in cash. If stocks are in favor, money is pulled from bonds, causing bond prices to drop and interest rates to possibly rise. When stocks are being sold off, the money is then parked into bonds, which improves bond prices and may cause interest rates to decline.

As for today, the Jobless Claims already have come out with a reported increase of 17k, up to $474k.

Hope you took our advice yesterday and secured your new home loan or refinance.

I’m pretty sure the damage to MBS has already been done this morning, so I’d recommend floating if you didn’t lock yesterday. You already took a hit, so now its time to minimize your damage. If anything changes, I’ll be back.