Here is a recap of what has been going on in the world of mortgage interest rates. We’ve been steady to slightly improving over the past couple or three weeks as the MBS-Mortgage Backed Securities, along with the 10 yr Treasury Bonds, had made marked improvements leading to the lowest rates in 50 years. However, Tuesday and Wednesday took much of that improvement away (and then some more) as banks actually raised rates and literally shut their doors due to the overwhelming amount of loan applications they had received during the past month prior to this week.
What do you do? The following suggested action is taken from a leader in the mortgage industry who monitors the rates on a daily basis and makes modified recommendations as we move along:
For loans that have 15-30 and 30+ days (before closing), I’d definitely float.
I’ve been saying we would see events like the last couple of days, although I didn’t think they’d be quite so severe and run back to back. Still, I stand by my belief that we don’t have to fear rates going up longer term at this point, especially with rate sheets having so much extra margin baked in still. When lenders clear the board and start wanting more volume, we will see rates drop back down again, but that may be a couple of weeks. Plenty of reason and room to see MBS improve from here as well.
Please be patient as we navigate these unchartered times together as seen below. Thank you. Call me with any concerns or questions.