– By Kevin McGoff, EverBank
The mortgage rate environment has been relatively flat for the past 4 to 5 months. There was a slight hiccup and rates went up in early January, which is typical every year, due to Wall Street’s incredible ability to sell optimism even when there shouldn’t be (we saw the highest Dow Jones numbers in years or ever)! Also, the Fed is very good at suppressing any real negative data at the beginning of every year, so the combination historically leads to rates going up in January. The same thing has happened again this year.
But, you can only suppress the bad news so much. Large layoffs at Deutsche Bank, JP Morgan Chase, Bank of America and other large financial companies have the markets concerned again, so the rate trend in the last few weeks has been downward and the 10 Year Treasury Yield has fallen about 40 basis points, so naturally the rates will follow.
Well qualified buyers are seeing 30 year fixed rates for conforming loan amounts remaining in the mid 4’s, while those looking for Jumbo loans have many options in the 3’s! Portfolio rates are lower than FNMA today and the forecast for March appears to remain similar. Not expecting any major changes to rates unless a major catastrophe occurs. Makes sense to lock when you can anyway, as most lenders will find a way to float down your rate (while locked) if there is a major improvement.
P.S. Don’t forget to ask your lender about a 10/1 ARM.. great product, especially for condo buyers! Good luck!