In The News
Calmer Seas
September 30, 2011 by andersmortgage · Leave a Comment
This week provided a bit smoother sailing than what we saw last week. The focus on Ben (Bernanke) doing the Twist wore off very quickly. After dropping to record lows on Thursday last week rates have been inching up since. Actually rates right now are just a tad lower than they were before the Fed announcement. More than anything the bond market has been taking the cue from the stock market. Unfortunately I am not able to capture it for this but if you graph the FNMA current yield vs. the S&P Index you will see an almost perfect correlation as of late.
The FNMA Current Coupon yield in the bond market closed at 2.77% on and yesterday we closed at 3.03%. So as you can see rates are up .25% from the lows. As the market and lenders have become more comfortable with these levels the margins, that had widened, have shrunk so retail mortgage rates have not moved as much. You will see below that retail rates mortgage are pretty much unchanged despite a significant move in the stock market.
The 10-year US Treasury Note is at 1.96%, up .20% since last week.
Credit Spread (10yr UST vs. FNMA Current Coupon) 1.04, 1.09 last time. See how the credit spread shrunk? That is what created the drop of .25% for mortgage yield when the 10-year not only moved .20%
Current 30-year Fixed is 3.875%. Jumbo 5/1 ARM 3.125%.
Of note, the conforming 5/1 ARM is now at 2.5%, the 7/1 at 2.875% and the 10/1 ARM is at 3.25%.
If you have any questions about renovation 203K loans or other mortgage products, or need help with a pre-approval, I am always happy to be of service.
