I don’t believe rates will run away, but there is nothing that would suggest rates will improve from current levels, so I urge clients to lock in rates early in the process of applying for new mortgages.
Mortgages improved Friday afternoon as tensions grew in Egypt and investors put more money into safety bets such as bonds and mortgages. This morning, we’re opening stable to closing levels on Friday, however, pressure remains and some of the gains in treasuries have been given back.
As incomes slowly creep back up, Americans are spending more freely and saving less. Personal income rose 0.4% in December, following a 0.4% increase in November, according to data released Monday by the Commerce Department. Both measures beat expectations. Income was expected to increase by 0.5% in the month
The mortgage and bond markets continue to digest improving economic data from recent weeks coupled with talks of inflation and uncertainty surrounding how the Fed’s QE2 will impact long dated fixed rates.
FHA rates are still very attractive allowing “jumbo” clients to purchase a home priced at $723,000 with 3.5% down and a 30 year fixed rate below 5%. (FHA loan limit in San Diego County is $697,500). You won’t have to worry Private Mortgage Insurance and their very restrictive debt to income requirements or the higher credit score needed to secure PMI approval.
For a snapshot of today’s rates, please visit my website.
Monday, January 31st
8:30ET Personal Income/Spending
9:45ET Chicago PMI
Tuesday, February 1st
10:00ET Construction Spending
10:00ET ISM Manufacturing Index
3:00ET Auto/Truck Sales
Wednesday, February 2nd
7:00ET MBA Mortgage Applications
7:45ET Challenger Job Cuts
8:15ET ADP Private Employment 150k
Thursday, February 3rd
8:30ET Weekly Jobless Claims 410k
8:30ET Productivity and Unit Labor Costs
10:00ET Factory Orders
10:00ET ISM Services Index
Friday, February 4th
8:30ET Monthly Employment Report 125k/9.6%