Mortgage Rate Stability

Today’s Mortgage Rates:

The first two full weeks of August have been volatile for bond markets and mortgage rates. During the last two weeks of August we’d like to see some stability in the bond market which would help keep mortgage rates low heading into September.

Mortgage Rates - Conforming Loans

Mortgage Rates - FHA Loans


Mortgage Rates - Jumbo Loans

Mortgage rates and loan applications:

Confirming, FHA and Jumbo fixed mortgage rates are at multi-year lows and because of this mortgage companies have seen a huge increase in loan application volume. In fact many lenders are near or at capacity and moving forward this might end up being a negative for mortgage rates.

The reason is simple; mortgage companies have little to no incentive to lower mortgage rates from these levels when they barely can keep up with the current influx of loan applications. Think of it like this; if owned a car dealership and you had thousands of people looking to buy a car but only had a 100 cars….would you lower the price?

Probably not and that’s the situation lenders are currently in. They can only process some many applications and they can only lender so much money. So when the demand exceeds that it’s unlikely they will aggressively lower mortgage rates.

Mortgage Backed Securities & Treasury Snapshot:

August 19th, 2019:

Mortgage Backed Security FNMA 3.0 started the day at 101.69, FNMA 3.5 started the day at 102.66 and the FNMA 4.0 coupon started the day at 103.69. The 10y Treasury yield started the day at the 1.60% level.

Shortly after the open bonds sold off and finished the day in the negative. As a result of the selloff mortgage rates were also slightly worse for the day.

August 20th, 2019:

Mortgage Backed Security FNMA 3.0 started the day at 101.69, FNMA 3.5 started the day at 102.67 and the FNMA 4.0 coupon started the day at 103.70. The 10y Treasury yield started the day at the 1.57% level.

August 21st, 2019:

Mortgage Backed Security FNMA 3.0 started the day at 101.45, FNMA 3.5 started the day at 102.55 and the FNMA 4.0 coupon started the day at 103.63. The 10y Treasury yield started the day at the 1.58% level.

August 22nd, 2019:

Mortgage Backed Security FNMA 3.0 started the day at 101.53, FNMA 3.5 started the day at 102.47 and the FNMA 4.0 coupon started the day at 103.55. The 10y Treasury yield started the day at the 1.61% level.

Shortly after the open the 10y yield moved above 1.62%.

August 23rd, 2019:

Mortgage Backed Security FNMA 3.0 started the day at 101.50, FNMA 3.5 started the day at 102.58 and the FNMA 4.0 coupon started the day at 103.50. The 10y Treasury yield started the day at the 1.65% level.

Simply put; this has been a wild day. Shortly after the open China announced new tariffs against the United States; then Trump tweeted he will retaliate. The 10y yield moved below 1.55% and Mortgage Backed Securities rallied but as we moved into the afternoon the rally in MBS started to fade.

Later today he will announce what he’ll do….stay tuned!

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Important Economic Data This Week:

Here we cover the daily economic events that might impact mortgage rates. After the report comes out we’ll update the post with that information and comment on if there is a potential impact on mortgage rates.

The Economic Calendar for the third week in August is fairly light and that might end up being a positive for mortgage rates. As mentioned previously; mortgage rates would benefit from a stable bond market and that might happen in the absence of a packed Economic calendar.

There are no major economic reports on Monday and Tuesday. On Wednesday we have the Mortgage Market Index, FOMC Minutes and Existing Home Sales. On Thursday we have the weekly Jobless Claims, and an important 30y Treasury bond auction. On Friday we have the New Home Sales report.

Mortgage Market Index:

Last week the index came in at 620.4. The Refinance component came in at 2742.9 and the Purchase component came in at 252.6. It would not be surprising to see an increase in these numbers (especially with the Refinance component).

UPDATE – This mornings report came in lower than last week due to a fall in purchase applications. The overall index decreased to 614.6, the Purchase component decreased to 243.8 but the Refinance component increased to 2754.7.

FOMC Minutes:

We’re not expecting a huge surprises but if one or two comes out we’ll update the post with that information and how it may impact mortgage rates.

Existing Home Sales:

Expectations are for a 2.5% increase after last months -1.7% decrease.

Jobless Claims:

Last week the Jobless Claims report came in at 220,000 claims and expectations are for this week are 216,000 claims. The reading came in at 209,000 claims and Continued Claims came in at 1,674,000.00

New Home Sales Report:

Last months report showed a 7.00% increase in sales with an annual rate of 646,000 units. Expectations for Thursday’s report is a decline of 0.2% and an annual rate of 649,000 units.

JB Mortgage Capital, Inc.:

We offer industry low mortgage rates for both refinance and purchase transactions, personal one-on-one service and we have an A+ rating with the Better Business Bureau (BBB). We also have a top rating with the Business Consumers Alliance (AAA).

A+ Rating With The BBB

We utilize the latest technology to ensure a fast closing and Loan Officer Kevin O’Connor has over 14 years of experience as a mortgage professional.

When it comes to mortgage rates please keep in mind that mortgage rates adjust daily; sometimes they adjust multiple times in a day when the bond market is volatile.

Nice Gray Home

Also things like obtaining cash out, lower credit scores, higher Loan-To-Value ratios, rental properties and the subordination of a second mortgage will cause in an increase in your mortgage rate.

To obtain the most up-to-date quote, specific to your loan scenario be sure to contact Loan Officer Kevin O’Connor at 1-800-550-5538 or you can submit a “Contact Us” request on the our website.

Loan Officer Kevin OConnor

Loan Officer Kevin O’Connor:

Kevin grew up in California and works with clients throughout the state. From the initial quote to the application to the final closing; Kevin works directly with each and every homeowner and encourages his clients to ask questions so that they’re better informed. He updates koloans.com on daily basis and you can connect with him on social media: Twitter Rates01