October 2020 News And Events

October 2020 mortgage rates in California – refinance and purchase transactions.

Opportunities for mortgage rates to move lower in October are there but limited. Expecting mortgage rates to push to new all-time lows is a very risky strategy but there is always the chance you will see some minor improvements here and there for the month.

Keep in mind that mortgage lenders throughout the country continue to see record volume so there is little to no incentive for them to significantly reduce mortgage rates no matter what the bond market does.

With the uncertainty of a fiscal stimulus plan and the upcoming election, there is some risk for mortgage rates moving forward. That doesn’t mean we’ll see a repeat of October 2018 when 30 year fixed mortgage rates hit 5% and the 10y yield moved past 3%.

However, it does mean that we may see a bump up in mortgage rates if investors feel there is an increased risk in owning Mortgage-Backed Securities and Treasuries.

If you are looking to purchase a home in California or refinance a current mortgage please be sure to contact me directly (you can use the contact form below or call my direct number: 1-800-550-5538) for a no-cost/no-obligation quote.

California Mortgage Calculator

Using a mortgage calculator to figure out your monthly payment is an essential part of buying a home in California or refinancing a current mortgage. Use our free mortgage calculator to help you determine what you can afford. With our online mortgage calculator, you can also factor in your property tax amount along with your annual homeowner’s insurance amount with your monthly mortgage payment.

Advanced Mortgage Calculator For City Pages

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Our California mortgage calculator is free and easy to use.

And our mortgage calculator is especially helpful for those who want to impound their property taxes and property insurance into their monthly mortgage payment. If you have any questions about or California mortgage calculator please don’t hesitate to ask.

October 2020 Mortgage Rate Forecast For California

Here are our October 2020 mortgage rate forecasts for California:

• 30-year fixed rates below 3.125%
• 20-year fixed rates below 3.00%
• 15-year fixed rates below 2.75%

This is based on properties in California, a loan amount of $350,000, primary home, excellent credit (740 or higher credit score), and a Loan-To-Value ration below 60% (purchase transactions). We may see days in which mortgage rates spike higher however overall we believe there will be opportunities to lock a mortgage rate at or below these levels throughout the month of October.

October 2020 Mortgage Rate Chart

Here is a quick reference guide to October 2020 mortgage rate possibilities in California (these are not quotes; just examples) and the payments associated with each level based on various conforming loan amounts. See our important disclosure below.

30-Year Fixed-Rate Mortgage:

20-Year Fixed-Rate Mortgage:

15-Year Fixed-Rate Mortgage:

Important Disclosure For October 2020 California mortgage rates: The above is not a mortgage rate quote; nor is it an offer to lend. It’s only a generic example of various mortgage rates, loan amounts, and payments. Our mortgage rate chart is meant to educate and inform our readers. The current market may be higher or lower than the examples listed in these rate charts. Also; mortgage rates can and often do adjust multiple times a day. 

Coronavirus and California Mortgage Rates – October 2020

The fiscal stimulus relief bill is still in a holding pattern as Republicans and Democrats continue to argue over how to best help the country recover from the economic damage caused by the Coronavirus. Republicans initially balked at the idea that the federal government should send another round of stimulus checks and did not want to maintain the increased level of unemployment benefits to those that have lost their job.

However, in recent weeks they have agreed to the stimulous checks and are open to some form of additional unemployment benefits. Some observers are estimating an agreement could happen in the first few weeks of October.

If so what would that mean for mortgage rates?

Difficult to say however I don’t think it will have a significant positive impact to mortgage rates. The most likely scenario is that mortgage rates remain stable to slightly increase due to the 1.5T to 2.0T influx of new money into the economy.

October 2020 Mortgage Rate FAQ’s

Here we answer some popular questions about mortgage rates in California.

Will Mortgage Rates Go Higher In October?

Predicting where mortgage rates will go in October or any other month is difficult at best. The best thing you can do is look at the market and consider where it’s been, where it’s at now, and what could shape the direction moving forward.

Mortgage rates reached an all-time low from late August through early September. Since then they’ve moved a bit higher but are still at historic lows. Furthermore, mortgage lenders are swamped with applications due to the current low mortgage rate environment so they have little to no incentive to push mortgage rates below current levels. If you are quoted a mortgage rate that meets your needs its best to be safe and lock that in sooner rather than later.

I am self-employed, is it harder for me to get a mortgage?

Simply put, yes. Be prepared to provide two years of personal and business returns, three to six months of bank statements, and a YTD profit and loss statement when you apply for a mortgage.

Can I still get a low-rate mortgage on refinance even though there’s an adverse market fee?

Absolutely!

It won’t be as low as if you were purchasing a home however at most it will only be a .25% higher (usually only .125%) when compared to a purchase. That means you still may be able to obtain a sub 3.00% 30-year fixed mortgage rate. That’s 2% BELOW 30-year fixed mortgage rates from two years ago.

Update Mortgage Guidelines October 2020

Heading into October 2020 mortgage guidelines remained mostly the same. The main difference between Ocotober and September has to do with the .50 point adverse market fee the federal government is charging mortgage lenders on refinance loan transactions. Just about every lender in the country is now adding this to their refinance mortgage rate quotes. It’s important to remember that this only applies to refinance transactions and not purchase transactions.

Economic Calendar For October 2020

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 the Mortgage-Backed Securities market and consumer mortgage rates.

To start things off we have:

• ISM Manufacturing report
• ADP Employment (sometimes comes out the day before the 1st of the month)
• ISM Non-Manufacturing PMI
• BLS Employment report

Thursday – October 29th:

• Weekly Jobless Claims: The weekly Jobless Claims report came in at 751,000 claims filed in the previous seven-day period, and continued claims came in at just under 8 million.
• Advance Q3 GDP: The Advance Q3 GDP report came in as expected, 33.1%. Keep in mind that Q2 dropped by roughly the same amount.

Wednesday – October 28th:

• Mortgage Market Index: It was another strong week for the Mortgage Market Index. Last week it came in at 794.2 and this week it came in at 807.8. Both the refinance component and the purchase component showed mortgage applications increasing.

Tuesday – October 27th:

• Durable Goods: The Durable Goods report came in stronger this month (1.9% vs 0.5%). There was no immediate impact on mortgage rates.
• Consumer Confidence: The monthly report showed consumer confidence in the economy retreated over the last four weeks but not by much. Last month the report came in at 101.8 and this month it came in at 100.9.

Monday – October 26th:

• New Home Sales: The New Home Sales Report came in at 959,000 units (annual rate). Last month it came in at 1,011,000 units (annual rate).

Friday – October 23rd:

• PMI-Composite (Markit): Last month the PMI-Composite from Markit came in at 54.3 and this month it came in at 55.5.

Thursday – October 22nd:

• Weekly Jobless Claims: Last week claims came in at 898,000 and this week the jobless claims came in at 787,000. Continued claims dropped from 10,018,000 to 8,373,000.

Wednesday – October 21st:

• Mortgage Market Index: Last week the Mortgage Market Index (MMI) came in at 798.9 and this week it came in at 794.2. Purchase applications came in slightly lower but refinance applications increased.

Tuesday – October 20th:

• Housing Starts: The September Housing Starts number came in essentially the same as last month; an annual rate of 1,415,000 units.
• Building Permits: The monthly Building Permits report came in much stronger this month; 1,553,000 permits (annual rate).

Monday – October 19th:

• NAHB Housing Index: The NAHB Housing Index increased to 85 this month (last month it was at 83).

Friday – October 16th:

• Retail Sales: The Retail Sales report came in higher than expected (1.9% vs expectations of 14.0%).
• Consumer Sentiment: This month’s Consumer Sentiment report came in at 81.2 and last months report of 80.5.
• 5y and 1y Inflation Expectations: The 5y report came in at 2.4% and the 1y report came in at 2.7%.

Thursday – October 15th:

• Philly Fed Business Index Oct: Last month the Philly Fed Business Index for September came in at 15.0 and the October report came in at 32.3.
• Weekly Unemployment: The weekly unemployment number jumped this week to 898,000 claims. Last week it came in at 860,000 claims. Keep an eye on this report; if it goes back above 1 million it might have an impact on mortgage rates.

Wednesday – October 14th:

• Mortgage Market Index: This week the Mortgage Market Index (MMI) came in at 798.9 (last week it came in at 804.7). Both the Purchase and Refinance components declined.
• Core Producer Prices: Core Producer Prices increased 0.4%.

Tuesday – October 13th:

• Consumer Price Index (CPI): Last month the CPI report showed a 0.4% increase and this month the report showed a 0.2% increase. Mortgage rates were no affected by this report.

Friday – October 9th:

• Wholesale Sales: The Wholesale Sales report came in at a 1.4% increase and there was no major impact on mortgage rates.

Thursday – October 8th:

• Jobless Claims: 804,700 Americans filed for unemployment which is an increase from last week’s reading of 837,000. Continued claims dropped to 10,976,000 which is good news for the economy.

Wednesday – October 7th:

• Mortgage Market Index: Applications to refinance increased significantly in the most recent survey however applications for the purchase of a home declined. This week’s report came in at 804.7 vs. last week’s report of 769.6.
• Consumer Credit: The Consumer Credit report showed a decline of $7.22 billion.

Monday – October 5th:

• ISM Non-Manufacturing PMI: Last month the ISM Non-Manufacturing PMI came in at 56.9 and this month the report came in at 57.8. There was no noticeable reaction to mortgage rates.

Friday – October 2nd:

• Monthly Jobs Report: Expectations are for the jobs report to show 850,000 jobs created in September. If that happens it would be a decline in the number of jobs created in August. The likelihood mortgage rates will be significantly impacted by this jobs report is minimal. UPDATE: The monthly jobs report showed 877,000 jobs created in September and the unemployment rate dropped to 7.9% (previously it was 8.2%). There was no noticeable impact to mortgage rates.
• Consumer Sentiment: Last month the Consumer Sentiment report came in at 78.9 and the market is expecting this month’s report to come in at 79.0. UPDATE: the Consumer Sentiment report came in at 80.4.
• Consumer Inflation Expectations: 1y inflation expectations last month came in at 2.7% and the 5y inflation expectation was 2.6%. We’ll update the post as soon as the report comes in on Friday. UPDATE: The Consumer Inflation Expectations report came in at 2.6% for the 1y report and 2.7% for the 5y report.

Thursday – October 1st:

• Consumer Spending: Consumer spending increased 1.0% in September and the August report showed a 1.9% increase.
• Core PCE: Core PCE report came in at a 1.6% increase (y/y).
• Jobless Claims: Last week the report came in at 870,000 claims and this week the report showed 837,000 unemployment claims were filed. The continued jobless claims came in at 11,767,000 after last week’s report of 12,580,000 continued claims. There was no significant impact to mortgage rates post report.
• Personal Income: Personal income declined by 2.7% in September and increasing 0.4% in August.
• ISM Manufacturing PMI: Market expectations are for a reading of 56.4 after last month’s reading of 56.0.

Mortgage Rates And The Monthly Jobs Report

On Friday we’ll have the monthly Jobs report. Last month 1,027,000 jobs were created (private payrolls) and this month the market is expecting the report to show 850,000 jobs were created in September. Earnings last report came in at 0.4 and market expectations for this report are 0.2. The unemployment rate is expected to move from 8.4% to 8.2%.

Will the jobs report impact mortgage rates?

It’s possible however unlikely. Unless the report significantly beats or misses what the market is expecting it’s unlikely that this month’s jobs report will have a major impact on mortgage rates.

October 2020 Mortgage Rate Average In California

We’ll update this section as we move further into October however to start off the month we’re seeing the following averages.

• The average 30-year fixed mortgage rate in California is 2.875%.
• The average 20-year fixed mortgage rate is 2.75%%.
• The average 15-year fixed rate in California is 2.625%.

This is an average of everyone we’re seeing; from less than perfect credit to excellent credit. Please keep in mind that October 2020 mortgage rates adjust daily; sometimes multiple times during a day. For a mortgage quote specific to your situation please be sure to contact us directly.

Mortgage-Backed Securities & Treasury Snapshot

October 26th – October 30th:

Mortgage-Backed Security UMBS 2.0 started the week at the 103.13 level and the UMBS 2.5 coupon started at the 104.19 level. The 10y Treasury yield was at the .80% level to start the week.

At the end of the week, Mortgage Backed Security UMBS 2.0 was at the 103.13 level and the UMBS 2.5 coupon was nearing the 104.20 level. The 10y Treasury yield was at .87.

October 19th – October 23rd:

Mortgage-Backed Security UMBS 2.0 started the week at the 103.08 level and the UMBS 2.5 coupon started at the 104.41 level. The 10y Treasury yield was at the .76% level to start the week.

At the end of the week, Mortgage-Backed Security UMBS 2.0 was at the 102.95 level and the UMBS 2.5 coupon was nearing the 104.14 level. The 10y Treasury yield was at .84.

October 12th – October 16th:

Mortgage-Backed Security UMBS 2.0 started the week at the 103.08 level and the UMBS 2.5 coupon started at the 104.44 level. The 10y Treasury yield was at the .73% level to start the week.

At the end of the week, Mortgage Backed Security UMBS 2.0 was at the 103.17 level and the UMBS 2.5 coupon was nearing the 104.53 level. The 10y Treasury yield was at .74.

October 5th – October 9th:

Mortgage-Backed Security UMBS 2.0 started the week at the 103.23 level and the UMBS 2.5 coupon started at the 104.63 level. The 10y Treasury yield was at the .75% level to start the week.

At the end of the week, Mortgage-Backed Security UMBS 2.0 was at the 103.22 level and the UMBS 2.5 coupon was nearing the 104.75 level. The 10y Treasury yield was at .76.

October 1st – October 2nd:

Mortgage-Backed Security UMBS 2.0 started the week at the 103.30 level and the UMBS 2.5 coupon started at the 104.83 level. The 10y Treasury yield was at the .71% level to start the week.

At the end of the week, Mortgage-Backed Security UMBS 2.0 was at the 103.40 level and the UMBS 2.5 coupon was nearing the 104.80 level. The 10y Treasury yield was at .70.

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