By John Sauro
North Atlantic Mortgage Corp.
Bonds Remain Pressured
Investors running towards equities pushed stocks to their 4th weekly gain.
Decent economic news sparked the rally in stocks which pressured Bonds lower.
Our 3.5% coupon Bond fell 31 basis points to end the session at $100.28, closing just near support at the 25-day moving average. The Dow rose 197.84 to 10,860.26.
So why do you need to know this and how does it effect you if your buying a home or refinancing one?
Very simply, if you are trying to lock into a low interest rate, you need to stay informed and understand some simple underlying fundamentals about the markets and how it affects mortgage rates.
While there are many things to know, there is one single thing that will help you to get a low mortgage rate. As a general rule; “When the stock market goes up, Bond prices go down and mortgage rates move higher”. So for those of you who consider yourself to be good at timing things or gambling, checking this daily can make a significant difference in the rate you lock into.
Fed to Make a Move in November?
Tuesday, the Fed clearly stated they are ready to jump in with more quantitative easing if necessary.
The well known Kiplinger letter reported today, that the Fed is laying the groundwork for further credit easing by propping up subpar activity in the housing markets with the continued buying of Treasuries and mortgage backed securities. “The Federal Reserve is walking a tight rope”. They stated that “too much buying of Treasuries and Mortgage Backed Securities by the Fed will fuel investor fears of future inflation;
“Fair odds that the “gurus will make a move in early Nov. at their next meeting”
Let Your Voice be Heard
There are 5 weeks before Election Day. I speak with many people from all walks of life and different political persuasions. But there is a common thread within all of these conversations. They are all disgusted with the current economy, the out of control government spending and government overreaching into our lives. I heard someone say recently “voting in the same politicians that are spending our money, is like giving a pyromaniac a can of gasoline and a book of matches”.
Now more than ever it is time for all of us to do our homework on the alternative candidates that are running for office. Do what we can to help support their campaign, vote them in and vote the bums out.
Fannie Mae 3.50% $100.28 -31