After several weeks of steadily increasing rates we finally had a pull back this week. This came as a result of renewed concerns about Europe’s finances after the close results in the Italian elections. Core PCE inflation in the US, a number closely monitored by the Fed, showed only a 1.3% increase from a year ago. That is well below the Fed’s target. This supports the Fed members that want to continue the Quantitative Easing bond buying which continues to be the dominant factor controlling mortgage rate levels.
In other news, there was more good news on the housing front as the Case Shiller 20-City Home Price Index showed that home prices improved year-over-year and from November to December. In addition, New Home Sales showed a strong rise in January, while Consumer Confidence for February improved steadily, both beating consensus estimates.
Mortgage rates are marginally lower on the week.
The 10-year US Treasury Note is at 1.85%, down .12 since last time.
Credit Spread (10yr UST vs. FNMA Current Coupon) 1.22, same as last time.
Current 30-year Fixed 3.375%. Jumbo 5/1 ARM 2. 50%.
Of note, the conforming 5/1 ARM is now at 2.25%, the 7/1 at 2.625%.
A View From The Top
It was very exciting to see the numbers from the Warren group and find Mortgage Master as the #1 lender in Massachusetts by a pretty wide margin. It’s now been over a year since I joined the company and I must say I have never seen a better and harder working team in mortgage banking. Add to that Mortgage Master’s product mix and low rates and it is no wonder how business keeps growing. I will do my very best to provide customer service that will help propel our growth.
If you have any questions about 203K loans or other mortgage products, or need help with a pre-approval, I am always happy to be of service.