Weekly Mortgage Rate Update (February 8th, 2016) Hagerstown, MD Real Estate

How Rates Move:

Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market.  This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events.  When MBS pricing goes up, mortgage rates or pricing generally goes down.  When they fall, mortgage pricing goes up.  Tracking these securities real-time is critical.  For more information about the rate market, contact me directly.  I’m among few mortgage professionals who have access to live trading screens during market hours.

Rates Currently Trending: Lower

Sigma Research says that rates are trending lower this morning.  Last week the MBS market improved by +27bps.  This was probably enough to affect rates or fees.  The market was extremely volatile last week.

This Week’s Rate Forecast: Lower

This week key economic reports won’t hit until Friday when we have Retail Sales and Business inventories, but we do have plenty of activity that we keep the markets guessing.

Oil: Here we go again. MBS have “popped” right out of the gate by as much as +32BPS in early trading today as WTI dropped to $29.64. Oil under $30 is very good for MBS pricing, while Oil over $32 starts to strip off some of our premium pricing.

Yellen: Our Fed Chief will testify before the House Financial Services Committee in Washington for her semi-annual monetary report on Wednesday and then again before the Senate on Thursday.

This Week’s Potential Volatility: Average

According to Sigma Research the risk for volatility is Average today and this week.  We’re e likely to see that market ratchet up volatility as the week goes on and hitting its peak on Friday with the release of Retail Sales and Business Inventories.

Bottom Line:

If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.

Your weekly mortgage rate update is provided by: