A quick weekly overview of where the mortgage markets are, where they have been, and where they are expected to go.

• Looking Back: For the third straight week, we once again saw a great deal of volatility in mortgage rates, but we finally did see some strong positive movement at the very end of the week, with mortgage prices roughly 41bps better than where they started the week.
• Right Now: For the “ideal” borrower (i.e. down payment on a purchase or equity for a refinance of at least 20%, FICO score of 740 or higher, and paying 1 discount point, with loan amounts of $417k or less on a 30-year fixed-rate mortgage) in the DC area, rates are currently in the 5.125% to 5.375% range.
• Moving Forward: With this week’s treasury auctions (the main source of volatility this week) completed, the next two weeks will probably be dominated by reactions of the stock market to any economic data that comes out; expect more volatility, with any large improvements in rates likely to only last for a few hours (although continued slow improvement over the long run is possible). In Bankrate’s weekly survey of mortgage analysts about where they expect rates to move in the next 45 days, 31% predicted that rates would go up, 38% predicted that rates would stay roughly level, and 31% predicted that rates would go down over that period. (That’s almost the exact same breakdown as last week’s 27-46-27; basically, 8% of the analysts got off the fence about whether rates would go up or down, but the ones who did pick a side split 50-50 on which side they picked…) In the shorter term, rates will continue to see high volatility; we strongly encourage borrowers who find a good rate to lock that rate in if possible unless their tolerance for risk is very high.

These updates are intended to give you a very quick snapshot of current mortgage rate trends. As a result, they are full of simplifications and assumptions; if you are currently in the process of purchasing or refinancing a loan, make sure to talk to your mortgage loan consultant about your specific scenario and the factors that affect it. If you aren’t working with a loan consultant yet, feel free to contact us and we’d be glad to meet with you for one of our free, no-obligation mortgage scenario consultations. And if you’re a data junkie and want to follow the gyrations of the mortgage markets in real time, learn about the shorthand that we use in discussing mortgage pricing and then follow us on Twitter.

Possibly related posts (automatically generated):

1. Mortgage Market Update 8/21/09
2. Mortgage Market Update
3. Mortgage Market Update 8/7/09
4. Mortgage Market Update 7/17/09
5. Mortgage Market Update 7/24/09
6. FHA/VA Adjustable-Rate Mortgages Can Be A Great, Safe, Deal
7. Refinancing
8. 2009 FHA loan guideline update
9. When Should You Lock In The Rate On Your Mortgage?
10. Construction / Acquisition & Development Loans

Tags: mortgage, trends