Tuesday, April 26, 2011

Weekly Mortgage Forecast for April 25th-29th

This is very busy week in the interest rate world.

The Federal Reserve begins it “two day open market committee meeting” on April 26th with a decision on interest rate policy being released on Wednesday, April 27th.  While the Securities were able to rise up above a level of resistance last week (which did see a nice small increase in pricing and a decrease in rates) this two day meeting is vitally important to the rate forecast. The decision will be released on Wednesday at 12:15 and for the first time ever, Chairman Ben Bernanke will be holding a press conference at 2:15 to discuss the outlook going forward as it pertains to inflation and the US Dollar.  The comments from these meetings and Chairman Bernanke are going to be market movers.  

At this time we are uncertain which way it is going to go.

Thankfully, the Mortgage Backed Securities came up above the level of resistance  - which is now the floor of support.  Barring anything extraordinary, as far as comments from Bernanke, I see this week being stable. We may possibly have an increase in pricing which equates to a  decrease in rates. Hopefully we can get back to the 4.5% level we have seen recently.

We will send out a midweek update - depending on the outcome of Wednesday’s meetings.

Thank you for your follow.

Michael Liles
Director of Secondary Marketing
Advantage Loans, Inc.
NMLS 91257

Monday, April 18, 2011

Mortgage Rate Forecast for April 18th - 22nd 2011

With traders pricing in a 64.5% chance that Greece will default on it's issued debt within 5 years, money has been flowing into the safe haven of U.S. Bonds. This had caused Mortgage Backed Securities to move slightly higher near the end of last week, but has also caused the Mortgage Backed Securities to battle a tough line of resistance at the 100 day moving average. A line of resistance that the Mortgage Backed Securities has fought and lost numerous times recently.
Short term the outlook is for stable or slight improving rates, while the long term outlook remains in favor of rising rates. When rates do finally make the turn around and head higher, it will happen very quickly. At this time it's best to advise your buyers to get off the fence and take advantage of what are still historically low rates.

Do not forget that the markets will close at 2:00 p.m. in Thursday and will be closed all day Friday, so any action that is going to take place in the Mortgage Backed Securities markets will do so by Wednesday.

It is our hope everyone has a safe holiday weekend.

Michael Liles NMLS# 91257
Director of Secondary Marketing
Advantage Loans, Inc.