By JON HILSENRATH

The Federal Reserve offered a slightly rosier economic outlook and reaffirmed it would stop buying mortgages in March, on the eve of the Senate vote Thursday on Ben Bernanke’s nomination for a second term as Fed chairman.

The Fed’s policy-making arm, the Federal Open Market Committee, said it would continue to keep interest rates near zero for an “extended period,” meaning at least several more months, according to a statement released Wednesday after a two-day meeting.

But in the first sign of dissent in a year, Thomas Hoenig, president of the Federal Reserve Bank of Kansas City, voted against the action, saying the economy and markets were strong enough for the Fed to remove its commitment to keep rates low.

Fed officials also voted to make Mr. Bernanke chairman of the FOMC for another year, an annual ritual that took on added significance ahead of the Senate vote.

The economy has “continued to strengthen” and business spending is “picking up,” the Fed said. It tweaked its outlook, saying the recovery would be “moderate for a time.” Since April, the Fed had been saying economic activity would be “weak for a time.” The changes indicated officials believed a recovery was sustainable but not brisk.

The Fed is trying to gradually pull back from the many programs initiated between 2007 and 2009 to stabilize the financial system and lift the economy. On Feb. 1, officials plan to stop a number of programs—including short-term loans to blue-chip companies in the commercial paper market, emergency credit to investment banks and loans of dollars overseas through foreign central banks.

On March 31, the Fed will complete its purchases of $1.25 trillion of mortgage-backed securities. Fed officials believe mortgage rates could rise when it stops its purchases, but most believe it will be less than half a percentage point and possibly not much at all.

The dissent by Mr. Hoenig, one of the Fed’s more outspoken voices against inflation, commences a more public debate about whether to remove the words “extended period” from the statement as a prelude to interest-rate increases.

The slightly improved outlook suggests rate increases are closer, though not likely until the second half of the year at the earliest. High unemployment or slowing inflation could put off rate increases even longer.

The Fed’s plans could change if any number of scenarios occur. If the economy takes a turn for the worse, officials have left open the option of purchasing more mortgage-backed securities to try to push mortgage rates lower. If the economy grows more quickly than expected, unemployment falls by more than expected, or inflation worries creep into markets, the Fed could be forced to accelerate its plans.

Meantime, the Fed is moving closer to a resolution of its leadership uncertainty. The Senate plans to vote Thursday on whether to confirm Mr. Bernanke to another four-year term as chairman. As of Wednesday, 53 senators had declared their support for Mr. Bernanke, and 20 had said they would vote against him. Mr. Bernanke effectively needs 60 votes. The remaining senators are undecided or haven’t stated their views.

On Friday, the government is expected to report the economy grew at an annual rate of more than 5% in the fourth quarter as firms stopped liquidating inventories. But it could lose momentum—recent reports on home sales have been particularly disappointing. Fed officials conspicuously deleted a reference in their statement to the improving housing sector.

Tuesday 8AM 01/26/10 Today’s Current Mortgage Rates Update News

I’m David Beadle. Here’s what’s happening from RateAlertNow.com.

Thirty-year mortgage rates rose on Monday after the stock market found its “footing” and held a narrow gain. There was talk that Fed Chairman “Ben Bernanke” might be granted a “second” four-year term as “Fed Head” after all. But the speculation will not end until the vote is in, and the “exact date” of the “U.S. Senate” showdown has “yet” to be determined.

The national-average 30-year fixed-rate mortgage rose to four-and-seven-eighths percent with one and seven-eighths points, up a quarter of a point from Friday, for an extra cost of $250 on a one-hundred thousand dollar loan..

The five-and-one-eighth percent rate rose an eighth of a point to “half” of one point.

Remember: one point is worth “one percent” of the loan amount. This means “one point” is one-thousand dollars on a one-hundred- thousand dollar loan…and two-thousand dollars on a two-hundred thousand dollar loan.

When it comes to a two-point loan, that represents two percent of the loan amount. This means “two points” is two-thousand dollars on a one-hundred thousand dollar loan…and four-thousand dollars on a two-hundred thousand dollar loan.

The national-average 15-year fixed-rate mortgage was “up” as well, with the four-and-a-quarter percent rate at one-and-five-eighths points, up an eighth of a point from Friday. The four-and-a-half percent rate rose to a “quarter” of one point.

In order for you to know “when” to lock your “floating” fixed-rate
mortgage, you have to have “an Early Warning” system with immediate news on changes in current rates & points +before+ they occur throughout every business day. That’s where my “Rate Alert Now” service becomes essential to your “rate lock” strategy. I’ll tell you via regular e-mail and/or mobile “text messaging” when current rates are about to go up, and if you act quickly, you may be able to reach your local mortgage originator by phone to lock your rate +before+ the mortgage company becomes aware of what’s going on, and changes its rates. The cost of my service is less than one dollar a day.

The bond market “benefited” from a report on Monday morning, saying existing home sales plunged 16.7 percent last month, after many people thought the $8000 federal income tax credit (for first-time buyers) would not be renewed. It eventually was extended, but too late to cause an improvement in the December data.

Today, we will find out how Consumer Confidence “fared” this month. The expectation is for a “sideways” trend.

That’s what’s happening. I’m David Beadle. For full details on my real-time mortgage rate alert service to help you “beat the system,” visit RateAlertNow.com and check back here later today for my next *free* mortgage rate update.

Monday 5PM 01/25/10 Today’s Current Mortgage Rates Update News

I’m David Beadle. Here’s what’s happening from RateAlertNow.com.

Thirty-year mortgage rates rose on Monday after the stock market found its “footing” and held a narrow gain. There was talk that Fed Chairman “Ben Bernanke” might be granted a “second” four-year term as “Fed Head” after all. But the speculation will not end until the vote is in, and the “exact date” of the “U.S. Senate” showdown has “yet” to be determined.

The national-average 30-year fixed-rate mortgage rose to four-and-seven-eighths percent with one and seven-eighths points, up a quarter of a point from Friday, for an extra cost of $250 on a one-hundred thousand dollar loan..

The five-and-one-eighth percent rate rose an eighth of a point to “half” of one point.

Remember: one point is worth “one percent” of the loan amount. This means “one point” is one-thousand dollars on a one-hundred- thousand dollar loan…and two-thousand dollars on a two-hundred thousand dollar loan.

When it comes to a two-point loan, that represents two percent of the loan amount. This means “two points” is two-thousand dollars on a one-hundred thousand dollar loan…and four-thousand dollars on a two-hundred thousand dollar loan.

The national-average 15-year fixed-rate mortgage was “up” as well, with the four-and-a-quarter percent rate at one-and-five-eighths points, up an eighth of a point from Friday. The four-and-a-half percent rate rose to a “quarter” of one point.

In order for you to know “when” to lock your “floating” fixed-rate
mortgage, you have to have “an Early Warning” system with immediate news on changes in current rates & points +before+ they occur throughout every business day. That’s where my “Rate Alert Now” service becomes essential to your “rate lock” strategy. I’ll tell you via regular e-mail and/or mobile “text messaging” when current rates are about to go up, and if you act quickly, you may be able to reach your local mortgage originator by phone to lock your rate +before+ the mortgage company becomes aware of what’s going on, and changes its rates. The cost of my service is less than one dollar a day.

The bond market “benefited” from a report on Monday morning, saying existing home sales plunged 16.7 percent last month, after many people thought the $8000 federal income tax credit (for first-time buyers) would not be renewed. It eventually was extended, but too late to cause an improvement in the December data.

On Tuesday, we will find out how Consumer Confidence “fared” this month. The expectation is for a “sideways” trend.

That’s what’s happening. I’m David Beadle. For full details on my real-time mortgage rate alert service to help you “beat the system,” visit RateAlertNow.com and check back here on Tuesday morning for my next *free* mortgage rate update.

The Mortgage Market Advisory™ The Week of January 11, 2010 Provided by Amy Arey Mortgage pricing ended the week slightly better by about .300 and kept the 30-year conforming fixed mortgage rate around 5.00%, The Employment report was weaker than expected last week and the unemployment rate remained at unchanged at 10.0%. The release of the Fed minutes was no surprise- they are committed to keep rates low “for an extended period of time.” The minutes also revealed they care contemplating the continuation or extension of the MBS purchase program which has helped keep mortgage rates low through 2009. If they do not, the market will have to organically absorb $15-$20 billion per month on it’s own- likely to increase rates due to supply/demand dynamics.

The Week Ahead: While this week will bring us a few data points that could move markets, it will mostly be about the Treasury Note auctions. We have 3yr, 10yr, and 30yr Note auctions this week (Tues-Thurs) that will be very important. If these auctions go well- we could see mortgage pricing improve slightly more this week, but if these auctions do not go well, we could see mortgage rates back on the path to going higher.

On Thursday we will get a look at how retail sales are going as well as the weekly jobless claims. On Friday we will get a look at how consumers are feeling and a view of how inflation is (or is not) working it’s way through the economy with the CPI report. Monday: No important data. We do have a 10-year inflation indexed note auction at 1:00. Tuesday: We have the 3-year note auction at 1:00 and this could set the tone for the rest of the week, although the markets will be watching the 10-yr and 30-yr much closer on Wed and Thurs. Wednesday: We get the very important 10-yr note auction at 1:00 and the Fed releases the Beige Book at 2:00. Thursday: Retail Sales – we get a look at the retail sales report and traders will be watching closely. We also get the Weekly jobless claims report at 8:30 and the 30-yr note auction at 1:00. Friday: We get a view of inflation at the consumer level with the CPI report at 8:30 as well as a look at how consumers feel with the Univ. of Michigan Consumer Sentiment report at 9:55.Mortgage pricing was a little volatile last week, but ended the week unchanged. However, mortgage rates moved up by .60 for the month of December, or down by about 200 bps in price/rebate. We are still hovering around 5.00% for a Conv. 30-Year fixed mortgage. It appears low mortgage rates will be with us at least until the Fed’s MBS purchase program comes to an end in March 2010 as scheduled.

 There are many speculating that the Fed may find a way to extend this program in some form to continue to support housing as it appears to be just getting legs under it. Low market rates in general will be with us for “an extended period of time” as committed by the Fed and Ben Bernanke. While there are discussions around possible exit strategies, none of the members seem to feel that any immediate or urgent action must be taken anytime soon relative to market rates. If the data continues to support an economic recovery, we expect mortgage rates to wander in a range from about 5.00% to 5.25% on the Conv. 30-year fixed, but to be choppy over the next 60 days.

Mortgage Market Advisory Disclaimer This is only our opinion and cannot be guaranteed to be in the best interest of any or all parties. This service is provided for informational purposes only and is not intended for trading purposes. None of the information provided constitutes a solicitation, offer, or recommendation by NHLA to buy or sell any security, or to provide legal, professional, tax, accounting, or investment advice. Every lender’s price desk has their own strategies and reactions to market movements. Our information is simply based on market movements and does not predict or report potential pricing adjustments by particular lenders.

To search for your new home, or view lending options, log onto my website at: www.TheFastestGrowingCityinTexas.com

According to the National Association of Realtors, last month we experienced a 7.4% jump in home resales. This is in all categories of homes from single family homes to condos and townhomes and it is occurring at all price points too from low to high priced properties. Even more interesting, sales are up in every region of the country but highest out here in the west.

Unsold inventories are down more than 16% from where they were a year ago. With low mortgage rates, tax credits and well priced properties, it’s a great time to be a buyer.

 Be forewarned though, mortgage rates will most likely rise in 2010. Note that the Wall Street Journal reports that Federal Reserve chairman Ben Bernanke has refinanced out of an adjustable-rate loan on his Washington D.C. home and into a more secure 30 year fixed rate around 5 percent.