Mortgage rates continued their volatility last week, ending the week slightly lower. The drastic daily changes in rates subsided a little last week though the market has certainly not settled down yet. Stay on top of the changing rates by visiting Amerisave often.
Bankrate Barring action by the government or the bail-out administrators, rates should remain within the current range. The steady barrage of weak economic data should bode well for mortgage bonds, yet there appears to be a floor that has not been breached.
Slow but steady improvement in the credit markets coupled with significant economic weakness could spell lower mortgage rates. Take advantage of the opportunity to lock as rates can change in a big hurry.
HSH Market Trends A lack of lending is helping to choke off economic growth, but consumers have also circled their wagons against the storm. The latest survey of Senior Loan Officers, which asks them about their institutions' lending policies, found that a solid 84% of them tightened credit availability to Commercial and Industrial business clients during the 4th quarter. As well, 100% percent of the firms still offering subprime mortgages imposed stricter conditions -- and, intentionally or not, noted a 100% decline in demand for these loans as a result. In fact, the only category which showed any form of loosening was criteria for "prime" quality residential borrowers -- only 69% of the firms reported raising the barriers to credit, down from 74% in the 3rd quarter. Not only is money harder to get, but fewer people are seeking it; demand for consumer loans was reported to be the lowest since about 1992.
Mortgage Commentary Overall, look for Tuesday or Thursday to be the most important day of the week with the PPI and CPI reports scheduled for release those days. They are the two most important releases of the week and can individually lead to large swings in the markets and mortgage rates. The FOMC minutes may also heavily influence trading and deserve to be watched also. I think this will be a fairly active week for mortgage rates, so please maintain regular contact with your mortgage professional.
The Weekly Market News is provided by Amerisave Mortgage Corporation using various news sources. Accuracy of content is not confirmed independently by Amerisave. Amerisave is not responsible for actions based on information or advice provided.
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