Shiny Trinket

How Rates Move:

Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market. This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events. When MBS pricing goes up, mortgage rates or pricing generally goes down. When they fall, mortgage pricing goes up. Tracking these securities real-time is critical. For more information about the rate market, contact me directly. I’m among few mortgage professionals who have access to live trading screens during market hours.

Rates Currently Trending: Neutral

Rates are trending a better this morning.  Last week the MBS market worsened by -47 bps.  This was probably enough to affect rates or  fees.  The market was extremely volatile last week.

This Week's Rate Forecast: Neutral

The MBS market worsened some last week, but it was a wild ride. This week will continue the volatility with wide trading ranges for MBSs and Treasuries. The biggest event of last week was Wednesday's release of the minutes from the last Fed meeting. They didn't really give us anything new to sink our teeth into. While there might be a few things that they included in the minutes...none of it was new because the bond market already knew it and we have had a plethora of "talking feds" over the past month and they have all spelled out their own opinions.  Bottom line is that we're not expecting much out of the Fed in the short term to push mortgage rates higher.  This week there are a lot of economic reports due out.  The one that has the potential to really move the market is 1st Quarter GDP. This originally was printed at +0.2% but the market is expecting a downward revision in the 0.0% to -0.7% range. Just how far this number is revised will have an impact on pricing and rates.  We'll be keeping a close eye on it.

This Week's Potential Volatility: High

The risk for volatility is high today and this week.  This is a shortened week with a lot of economic news.  It could be a wild ride for mortgage rates with Friday being the most likely volatile day with the announcement of the 1st Quarter GDP.

Bottom Line:

If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.

I welcome the opportunity to work with those who want to buy but for various reasons aren't able to-today.Everyone starts with Step #1 - it may take some longer than others.My purpose is to help everyone who wants to own a home–no matter what the obstacles or the time that it takes.

All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

Equal Housing Lender. This is not a commitment to lend or extend credit. Restrictions may apply. Rates may not be available at time of application. Information and/or data are subject to change without notice. All loans are subject to credit approval. Not all loans or products are available in all states. Bay Equity LLC, 100 California Street Suite 1100, San Francisco, CA 94111-4561; NMLS ID#76988. Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act- #4150077; NMLS consumer access: www.nmlsconsumeraccess.org NMLS ID#76988