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Bart Castelli

Mortgage Rates Inched Lower

Friday, November 14, 2014 - Article by: Bart Castelli - Homestar Financial Corporation NMLS #70864 - Message

Mortgage rates inched a bit lower today, but not enough to change the actual rate that has been quoted for the past few days except for fees. The most prevalently-quoted conforming 30yr fixed rate for top tier scenarios was pushed solid to 4.125%, but depending on various fees 4.00% can still can be done.

Another week closer to the end of the year as we are seeing Black Friday just around the corner - but really no change in our treasuries or MBSs. The third week in succession where interest rate markets didn't change in any appreciable way. Another week where pundits were out predicting the 10yr note would hit 2.60% by the end of the year - probably the same people that three months were completely sure interest rates would be above 3.00% on the 10. It isn't happening and we continue to expect rates will remain close to the current levels through the end of the year. As long as inflation is dormant and is expected to stay rather tame and under 2.0%, investors will hold long dated interest rates as a hedge against the coming steep fall in stock markets we expect in 2015.

This week had very little important economic repoerts. We did have another day where the 10yr still is stuck in a narrow range - at 2.32% it is at the low end of the range and declined 3 basis points today. MBS prices better than when prices were set this morning. Our technical work however is still slightly bearish. The 10yr needs a close below 2.30% to set up more rate improvements. Not expecting a huge decline in rates though; for that to occur the equity market would have to turn over and I don't expect that will happen this year. Next year though, look out.

In summary, we finished the week on a positive note heading into the weekend with rates still at very attractive levels. We are still in the recent range and considering this week's data contained few surprises it is refreshing that we end the week with rates little changed. There is always a possibility things can change quickly in this industry, loans closing in 15 days should be locked, and heading into the weekend it's a case by case on floating. I am still a believer that we may see better rates, the question is when.

Keep a strong look at the markets and continue to cautiously float if you do want to take a risk. Remember, if you want to know the benefits of locking your rate today versus floating, simply give me a call at 314-744-7806 or visit me on my website at I have access to real time Wall St. data and instant market alerts with breaking news that I monitor throughout the day to assist us on making the informed decision.

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