San Diego Mortgage Group

Mortgage rates began the week on a bad note but reversed course today following a weak read on the housing sector. The National Association of Realtors this morning released Existing Home Sales data for July. This data totals the number of previously owned homes in which a sale closed during the prior month. Since the expiration of the home buyer tax credit, home sales have fallen significantly and many economists have lowered their economic forecasts. This report was horrible. There is no other way to describe it… Existing Home sales fell by a record 27.2% in July to an annualized pace of only 3.83 million home sales. This was far short of expectations. Making matters worse, the June report was revised lower, from 5.37million to 5.26 million. The report also indicated that supply of homes…(read more)

From 10,000 feet the story of the week was " Mortgage Rates Rebound from Losing Streak ", but when you look closer, I think the bigger story was " Mortgage Rates React to Economic Data. Twice! ". Once for the worse, once for the better. Yesterday was the better and it was the reason why mortgage rates rebounded from their three day losing streak. Since mortgage rates have basically moved (lower) at will for the majority of the summer, I think we should stop and call attention to the times when mortgage rates actually react to economic data. Not because I feel the bond market is trying to tell us the economic environment is fundamentally worse or better (LONG TERM OUTLOOK) , but because I think the bond market is telling us it is looking for some directional guidance (SHORT…(read more)

Mortgage rates extended their losing streak to three (3) days yesterday. The losses were brought on by a rally in the stock market. Mortgage-backed securities price moved steadily lower throughout the day before closing at their session lows. Most lenders ended up repricing for the worse as a result. Two economic data releases moved mortgage rates today. First up were Weekly Jobless claims. Released by the Department of Labor, this report provides three timely metrics on the health of the labor market: Initial Jobless Claims: totals the number of Americans who filed for first time unemployment benefits in the previous week Continued Claims: totals the number of Americans who continue to file for benefits due to an inability to find a new job Extended and Emergency Benefits : totals the number…(read more)

Mortgage rates are on a bit of a losing streak! Spurred on by a dramatic decline in benchmark debt yields, mortgage rates touched new lows last week. Actually I don't know if I should say mortgage rates hit new lows. Instead, maybe I should say "more lenders were offering record low mortgage rates last week". Yes a few lenders were spotted quoting 4.00% base rates, but the majority of the market was still pricing par mortgage loans at 4.25%. A well-qualified borrower's "best execution" combination of rates and points remained 4.375%. Whatever dip there was ended up being quick because lenders filled their production buckets fast and loan pricing started to suffer on Friday. Since then rates have slowly risen to levels just above record lows (still super aggressive…(read more)

Mortgage rates fell to new record lows last week after the Federal Reserve announced they would reinvest principal paydowns of their agency mortgage-backed security portfolio into U.S. Treasuries. While this announcement did lead benchmark Treasury yields significantly lower, mortgage rates lagged greatly as lenders dealt with an influx of lock requests and new loan applications. Consumers who were floating their loan saw total borrowing costs decline by a few basis points, but the best rates are still between 4.25% and 4.625%. READ MORE ABOUT THE FED'S NEW POLICY INITIATIVE READ MORE ABOUT WHY MORTGAGE RATES LAGGED TREASURIES After an unexpected increase in mortgage rates on Friday, lenders improved consumer borrowing costs this morning, but only marginally. The best execution 30 year…(read more)

The bond market has experienced a huge "flight to safety" over the last seven days. This "flight to safety" has led mortgage rates to new lows. The economic calendar was quite busy this morning. First out was Housing Starts & Building Permits from the Department of Commerce. Housing starts data estimates how much new residential real estate construction occurred in the previous month. Building Permits data provides an estimate on the number of homes planning on being built, a forward looking indicator of economic expansion. Recent reports on housing have been very disappointing, especially since the homebuyer tax credit expired in April. Today’s report showed a modest improvement in July but still less than economists had expected. Housing Starts rose 1.7% to a…(read more)

The Federal Open Market Committee, the group of Federal Reserve governors who determines the direction of our nation's economic policy, released their statement yesterday. While the policy statement did not offer any major surprises, they reminded us that the economic recovery will be slow and announced a new operation where they will purchase Treasury debt in the open market. This action was aimed at preventing the spread of fear in the marketplace. After the Fed announced this decision, stocks sold off and benchmark interest rate moved significantly lower as another "flight to safety" poured into Treasuries. A flight to safety happens when investors are nervous about owning risky assets like stocks, but do not want to miss out on earning a return on their funds, so they allocate…(read more)

Last week ended with mortgage rates on hold at the best levels of our lifetime following a weaker than expected Employment Situation report. The most anticipated event in the week ahead is the Federal Open Market Committee’s meeting, where our nation’s monetary policy is set. It is widely accepted that there will be no change to the current Fed Fund rate of 0 to .25%; however, market participants will scour the statement for any hint of future monetary policy and the Fed’s outlook on the economy. As far as economic data, the highest impacting reports will be released on Friday when we get three reports on the health of the American consumer. First out will be a read on inflation at the consumer level with the Consumer Price Index. Released at the same time will be the Retail…(read more)