FNMA 30 Year Fixed: 5.00%
FNMA 15 Year Fixed: 4.25%
USDA / FHA / VA: 5.00%
Hello Friends,
As you can see, mortgage rates continue to hold their own through the first 5 weeks of the New Year. This is due mostly to the big sell off on Wall Street over the past week. Remember, in most cases, when the stock market is in a dive, money is moving into the security of bonds….as bond yields move up….rates go down. Good news for us.
The Fed purchased $12 billion in Mortgage Backed Securities last week. This brings the total to $1.173 trillion and only leaves $77 billion to be used over the next eight weeks. As we’ve discussed in the past, these purchases are part of the stimulus package and will end at the end of March. We’ve also talked about how the media can shape consumer behavior…..CNBC’s Steve Liesman commented this morning there will be no change to mortgage rates after the Feb stops buying….don’t bet on it. Every indication I have from the bank and mortgage industry is that rates will rise a bit after this massive flow of money ends. Think about it……$1.943 TRILLION has been introduced into the market to purchase “bad” loans. By no means will it get all of them. What happens to loans left on the market? They will under perform. I don’t expect rates to go through the roof but they will certainly come out of the 5.00% range. Please continue to educate your buyers that rates will be higher as we approach the summer.
Provided by Alan Vanderheiden - Regions Bank
John Holbrook - Realtor Amelia Island, Fernandina Beach & Yulee, Florida
Cell: 904-415-0171 Email: holbrook66@msn.com Web: www.nassaumls.net
www.johnholbrook.blogspot.com
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