The inflation data will be the most important release this week. The recent inflation reports were mixed. The PCE price index will be carefully watched for any signs of inflationary pressures. The bond market will close early Thursday in advance of the Christmas holiday Friday. The shortened trading week may result in some market volatility coupled with thin trading conditions likely.

The Federal Reserve left interest rates unchanged last week as expected. The remarks were mixed and caused some mortgage market uncertainty. The Fed statement indicated, “subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period. To provide support to mortgage lending and housing markets and to improve overall conditions in private credit markets, the Federal Reserve is in the process of purchasing $1.25 trillion of agency mortgage-backed securities and about $175 billion of agency debt. In order to promote a smooth transition in markets, the Committee is gradually slowing the pace of these purchases, and it anticipates that these transactions will be executed by the end of the first quarter of 2010. The Committee will continue to evaluate the timing and overall amounts of its purchases of securities in light of the evolving economic outlook and conditions in financial markets.” The Fed’s challenge will be stepping out of the mortgage market without causing mortgage interest rates to spike uncontrollably higher. The housing sector is a vital component of the economy. The last thing the Fed needs is for mortgage interest rates to escalate causing the housing sector to suffer. While the most recent data shows positive housing trends across most of the nation, analysts attribute the positive movements to artificially low mortgage interest rates tied to the Fed buying of mortgage bonds. How this will all play out is still very uncertain.

More updates later!

Wednesday 8AM 12/16/09 Free Mortgage Rates Update

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

Thirty-year mortgage rates rose for a fifth consecutive day after the November producer price index showed a huge jump in price pressures at the wholesale level. Higher inflation hurts the value of fixed-income securities such as mortgages.

The national-average thirty-year fixed-rate mortgage is now at four-point-seven-five-percent with two-and-five-eighths points, up a quarter point from Monday, for an extra cost of two-hundred-fifty dollars on a one-hundred thousand dollar loan.

The five percent rate is now at one full point, also up a quarter of a point from Monday.

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 fifteen-year fixed-rate mortgage was up an eighth of a point, with the four-and-a-quarter-percent rate at one-and-three-quarters points. And the four-and-a-half percent rate is now at three-eighth 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 on changes in 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 rates are about to go up, and if you act quickly, you may be able to reach your local mortgage professional by phone to lock your rate +before+ the mortgage company has had time to execute an emergency rate change. The cost of my service is less than one dollar a day.

As mentioned, November producer prices were way up, with a month-over-month gain of 1.8 percent which was more than double the Wall Street estimate. And the “core” rate, excluding food and energy, also was more than twice as high as expectations.

Today, we will see the consumer inflation numbers for last month. The estimate is that price pressures at the “retail” level probably doubled from October.

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.

Tuesday 5PM 12/15/09 Free Mortgage Rates Update

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

Thirty-year mortgage rates rose for a fifth consecutive day after the November producer price index showed a huge jump in price pressures at the wholesale level. Higher inflation hurts the value of fixed-income securities such as mortgages.

The national-average thirty-year fixed-rate mortgage is now at four-point-seven-five-percent with two-and-five-eighths points, up a quarter point from Monday, for an extra cost of two-hundred-fifty dollars on a one-hundred thousand dollar loan.

The five percent rate is now at one full point, also up a quarter of a point from Monday.

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 fifteen-year fixed-rate mortgage was up an eighth of a point, with the four-and-a-quarter-percent rate at one-and-three-quarters points. And the four-and-a-half percent rate is now at three-eighth 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 on changes in 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 rates are about to go up, and if you act quickly, you may be able to reach your local mortgage professional by phone to lock your rate +before+ the mortgage company has had time to execute an emergency rate change. The cost of my service is less than one dollar a day.

As mentioned, November producer prices were way up, with a month-over-month gain of 1.8 percent which was more than double the Wall Street estimate. And the “core” rate, excluding food and energy, also was more than twice as high as expectations.

On Wednesday, we will see the consumer inflation numbers for last month. The estimate is that price pressures at the “retail” level probably doubled from October.

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 Wednesday morning for my next *free* mortgage rate update.

Tuesday 3PM 12/15/09 Mortgage Rate Alert

Hello, I’m David Beadle at RateAlertNow.com.
Coming up at 5PM Eastern Time:

I’ll tell you what happened to mortgage rates this morning after release of the November producer price index on inflation at the wholesale level. The estimate had been for a sharp increase which would have been bad news for interest rates.

And I’ll have the latest on what they’re saying about tomorrow’s report on November consumer prices and how much Wall Street analysts think, they may have risen.

The full story when the markets close–in less than two hours–right here–on YouTube.