Both Mortgage Backed Securities and Treasuries both opened the day slightly positive with the 10y yield at the 2.63% level. Post jobs report bonds turned negative however it was nothing significant (more on the BLS employment report below). Mortgage rates will start the day at similar levels too Thursday as we head into the weekend. Overall it’s been a great week for mortgage rates as the market returns to levels seen late December 2018 – early January 2019.
After the ISM Manufacturing PMI report was released bonds started selling off; the 10y yield moved up to the 2.80% level (more on this below). The Mortgage Backed Securities market was also selling off and it appears lenders may adjust rates if the market does not improve from these levels.
Today we have the BLS Employment report, and ISM Manufacturing PMI. Due to the government shutdown Retail Sales and Durable Goods continue to be delayed. Next week have the ISM-New York Index for January and Factory Ex-Transport on Monday. On Tuesday we have International Trade Data, ISM Non-Manufacturing and a 3y Note Auction. On Wednesday we have the weekly mortgage data (Refinance and Purchase applications) along with preliminary Productivity and Labor Costs for Q4. There is a 30y Bond Auction on Thursday along with Consumer Credit for December. There are no major economic reports on Friday.
BLS Employment Report:
Today’s employment report was strong; really strong in terms of the number of jobs created however the revisions to last month and the low wage number are a cause for concern (for the economy). As for mortgage rates; the revision to last months number and the low wage growth are a positive and probably one of the reasons Mortgage Backed Securities did not sell off significantly post report.
Why This Matters To Mortgage Rates:
This matters to mortgage rates because the monthly jobs report is a good indicator of how well the economy is doing. The BLS employment report is one of the most important economic reports issued. A key component to the report is wages earned and this month it came in at .1 which is a positive for mortgage rates (low to moderate wage growth helps keep inflation in check which is good for mortgage rates).
ISM Manufacturing PMI:
January’s data came in stronger than expected (56.6 vs 54.2) and overall a good report for the economy. This is the second solid report of the day and post release the bond market selling intensified. The 10y yield pushed up to 2.83% and Mortgage Backed Securities also sold off.
Why Is This Important To Mortgage Rates:
The ISM Manufacturing PMI report is a survey of over 400 purchasing and supply executives nationwide across lots of different industries. This report is an important gauge as to the health of the US economy and thus has an influence over the Mortgage Backed Securities market and mortgage rates. A stronger report (like today’s) is a negative for mortgage rates and a weaker report is a positive for mortgage rates.
California Mortgage Rates (Conventional)
California FHA Mortgage Rates
First Time Homebuyers:
Are you a First Time Home Buyer? At koloans.com we offer a wealth of real world information to help you purchase your first home. JB Mortgage Capital, Inc. offers many first time home buyer loan programs at great rates with low down payment options. The great thing about working with us is that from loan application to closing you’ll work directly with one person. Most mortgage companies pass you from one department to the next during the process which can create a multitude of issues for the buyer and is a less efficient process. The fact is you’ll have questions, probably lots of questions – knowing who to call and getting an answer in a timely manner is essential.
Important Mortgage Tips For First Time Homebuyers:
- Know your income and credit history before you get started: I would not worry too much about finding your credit score because ultimately it may differ significantly from what mortgage companies obtain when they run your credit. Just know your credit history; roughly the number of accounts, how long they’ve been open and payment history.
- Work with an experienced Realtor: This is super important; work with a Realtor who has a lot of experience with first time home buyers.
- Work with a reputable mortgage company: Look up on the Better Business Bureau’s website the mortgage companies you’re getting quotes from. It only takes 30 seconds to do but it could save you thousands of dollars.
Is Now a Good Time To Refinance?:
The answer to that question depends on when the homeowner obtained their current mortgage and what their goals are for obtaining a new mortgage. Now is a good time to refinance if you have a 30 year fixed mortgage rate above 4.50% or a 15 year fixed mortgage rate above 4.00%.
Additional Reasons Why:
- The homeowner wants to improve their home and needs cash out to pay for the renovations.
- Moving from a 30 year fixed rate mortgage term to a 15 year fixed rate mortgage term
- There is an unexpected expense (ie medical) and needs cash out.
Currently We Are Seeing:
30 year fixed mortgage rates below 4.25%, 20 year fixed mortgage rates below 4.125% and 15 year fixed rates below 3.50%. Please keep in mind that mortgage rates adjust daily; sometimes they adjust multiple times in a day when the bond market is volatile. 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 get 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.
JB Mortgage Capital, Inc.:
We offer industry low mortgage rates, personal one-on-one service and we have an A+ rating with the Better Business Bureau (BBB). We also have the top rating with the Business Consumers Alliance (AAA). We utilize the latest technology to ensure a fast closing and Loan Officer Kevin O’Connor has over 14 years of experience as a Loan Officer. You can contact him directly at 1-800-550-5538.