Friday May 13, 2011 10:15 am ET
By John Sauro
Bonds Up, Mortgage Rates Down
Over the last twenty six days mortgage rates have benefited from the Bond markets impressive gains.
Mortgage Bonds 4.50 percent coupon closed at $98.00 on April 13th and moved steadily higher to close at $100.43 on May 9th, a gain of $2.43.
While Mortgage Bonds did break above the 200-Day Moving Average briefly, the gains were not sustainable. A poor 30 year bond auction on Thursday pushed Mortgage Bonds lower, which now stand at $100.18, 25 basis points lower as I write this (see chart below).
Mortgage Applications jumped 8.2 percent last week due to mortgage rates moving lower. The 30 Year Fixed Rate is currently 4.625 percent.
Jumbo Loan Deadline is October 1st
Time is running out for buyers to buy a home and for those who want to refinance a home in high-cost areas. As of October 1st, the maximum loan amount Fannie Mae and Freddie Mac will accept is set to decrease from $729,750 to $625,600. Currently a Jumbo loan up to $729,750 in Hi-cost areas like NYC carries a rate of 4.75%. Its anyone’s guess where Jumbo Mortgage rates will be after October.
Millions Refinance-Billions Saved
Housing remained affordable for the month of March as mortgage interest rates remained near record lows. Almost 10 million Homeowners have taken advantage of low-interest mortgage loan rates and are showing a steady pace of refinancing since 2009, according to the Obama Administration Housing Scorecard. Consumers have saved around $18.8 billion in mortgage payments by refinancing to a lower interest rate.
Existing Home Sales
Wednesday the National Association of Realtors stated Existing Home Sales are on the path to recovery.
Existing sales of Single-family homes and condo’s rose 8.3 percent to a seasonally adjusted annual rate of 5.14 million in the first quarter from 4.75 million in the fourth quarter. However, the national median price is down 4.6 percent in the first quarter. A home that would have sold for $166,400 in the first quarter of 2010 is now $158,700 for the first quarter of 2011.
Update on FINREG (Financial Regulation)
Protect your homes value and your right to affordable home financing.
The focus is now on the Dodd-Frank Bill.
With implementation of the Dodd-Frank Bill a couple of months away, much has to be done to repeal or at least modify language in the Bill.
This Bill is another government power grab and will its unintended consequences will ad further pressure to the real estate market.
Get involved and let you elected officials know your concerns.
Already prepared template letters and contact info for your Congressman and Senator are available at: