WEEKLY RATE – Interest Rates Move Up .125%
I hope everyone had a happy and safe 4th of July!!
After floating around 8 month lows the week before, interest rate pricing took a turn for the worse starting on Tuesday of last week. From Tuesday to Monday July 3rd, interest rate pricing increased every day. See article below from mortgage news daily:
Worst 5 Days For Rates Since The Election
by: Matthew Graham
Jul 3 2017, 1:42PM
Mortgage rates continue rising at an uncomfortable pace for anyone in the market to buy or refinance. Today was the 5th straight day of quicker-than-average movement higher and it leaves the average lender at the highest levels in nearly 2 months.
Whether or not this is as dramatic as it sounds depends on your perspective. While it’s true that the past 5 days have been the worst since the US presidential election, it’s also true that interest rates are just over an eighth of a point higher during that time. An eighth of a point (.125%) will cost you about 14 bucks a month on a $200k loan. Alternatively, it would cost you $1200-$1600 in cash to get the rate back down to levels from 5 days ago on the same loan amount.
For years, lenders have capitalized on the psychology of “monthly payments.” $14/mo doesn’t sound like too much when it comes to a $200k home loan. But consider going out of town for a week and coming back to find your closing costs roughly $1400 higher simply to keep the same quote you had last week. For most, the $1400 upfront cost is the more effective way to communicate the true change in cost.
Bond markets and mortgage lenders will be closed tomorrow for the Independence Day Holiday. The safest strategy is to assume the current weakness will continue until we see a definitive bounce.
The Mortgage Backed Security (MBS) market closed last week down -57 bps and closed Monday down another – 13 bps. Interest rates moved up about .125%. 4.125% is now the lowest rate we can offer for less than a point.
The June US Non Farm Payroll report comes out on Friday. Most experts I read have bearish technicals in regards to rate improvement, so my suggestion is locking rate pricing.
As always, have an amazing week and I’m always available if you need help with a new home loan purchase or refinance. firstname.lastname@example.org ; 480-206-5577.
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Below are today’s interest rates. Have a great week!!
TODAY’S INTEREST RATES:
30 year fixed: 4.125% – .66 points (4.25% APR), 4.25% – 0 points (4.28% APR), 4.5% – $0 costs (4.5% APR)
20 year fixed: 3.875% – .98 points (4.07% APR), 4.125% – 0 points (4.17% APR), 4.25% – $0 costs (4.25% APR)
15 year fixed: 3.375% – .99 points (3.57% APR), 3.75% – 0 points (3.79% APR), 4.125% – $0 costs (4.125% APR)
5/1 ARM: 3.5% – .99 points (3.7% APR), 4.0% – 0 points (4.07% APR)
30 year fixed FHA: 4.0% – .83 points (4.86% APR), 4.25% – 0 points (4.95% APR), 4.625% – $0 costs (outside of FHA Fee) (5.32% APR)
15 year fixed FHA: 3.75% – .95 points (4.24% APR), 4.125% – 0 points (4.42% APR),
30 year fixed VA: 4.0% – .95 points (4.19% APR), 4.25% – 0 points (4.29% APR), 4.5% – $0 costs (4.54% APR)
30 year Fixed Jumbo: 4.125% – .56 points (4.23% APR), 4.25% – 0 points (4.3% APR),
7/1 ARM Jumbo: 3.375% – .81 points (3.53% APR), 3.625% – 0 points (3.67% APR)
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WEEKLY RATE – Interest Rates Move Up .125%