Mortgage rates for February 22nd, 2019 will start the day at improved levels as both Mortgage Backed Securities and Treasuries start the day in positive territory. With no major economic reports slated for release today we may see some volatility if any significant news stories come out before the end of the day (ie US-China trade negotiations). If all stays the same (or improves) mortgage rates will finish the week near their one year lows.
Mortgage Backed Securities and Treasury Snapshot:
Mortgage Backed Security Coupon FNMA 4.0 opened the day at the 102.00 level and the 10y Treasury opened at the 2.68% level. Shortly after the open both continued to rally to improved levels: FNMA 4.0 – 102.03 and the 10y – 2.66%. It wasn’t immediately known as to why bonds opened up into a rally; one reason might be that investors oversold their positions yesterday considering the poor Durable Goods and Philly Fed Data.
The Mortgage Rate Range:
We’ve touched on this a few times; mortgage rates have been in a range recently (as well as bonds) and the top part of the range has been slowly moving down while the bottom part of the range has been fairly flat. At some point the range will be broken however the timing of that is unknown. The 10y yield range, which is easier for consumers to track, has been between the 2.72% level and 2.61% level (keep in mind the 10y does not set mortgage rates but it does influence the Mortgage Backed Securities market).
The rally in Mortgage Backed Securities and Treasuries continues with FNMA 4.0 at 102.07 and the 10 year yield at the 2.64% level. Several members of the Fed issued public statements today and the result has been favorable for Mortgage Backed Securities (and mortgage rates). Vice Chair Richard Clarida said that the Fed was reviewing tools to help the economy that were previously reject (like capping treasury yields). James Bullard (President of the St. Louis Fed) was also out with some comments today as well. He believes the balance sheet unwinding will end before the start of 2020. He also made comments that he’s not “penciled in” a rate cut for this year and the Fed does not need to be worried about inflation. Lastly; he believes rates remain where they are to see how the economy holds up. Another Fed member (Randal Quarles) said the balance sheet reduction program would be quickly “re-evaluated” if it caused problems (according to CNBC).
These statements are a positive for Mortgage Backed Securities and mortgage rates however is it enough to push the market to new lows? Probably not but if the data next week is a negative for mortgage rates today’s events might prevent mortgage rates from moving significantly higher.
FHA Mortgage Rates
There are no important economic reports on Friday February 22nd, 2019. Next week will be a bit more active with many important economic reports slated to be released. We have Wholesale Inventories and Wholesale Sales on Monday. On Tuesday we have Building Permits, CaseShiller, Housing Starts and Consumer Confidence. Wednesday brings the weekly Mortgage Market Index data, Durable Goods (for January). Thursday is the GDP Prelim Q4 report and Chicago PMI report. We finish off the week with Core PCE, Personal Incomes, Retail Sales (January), and ISM Manufacturing PMI (February).
Currently We Are Seeing:
30 year fixed mortgage rates below 4.375%, 20 year fixed mortgage rates below 4.25% and 15 year fixed rates below 3.75%. 30 year fixed FHA mortgage rates are below 4.125%.
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 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.
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). 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.