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Mortgage Rates Highest In More Than Two Years
Dated: August 20 2013
Loan Originator Perspectives"Another day, another set of higher rate sheets and round of PM lender price worsens. Sound like a broken record at this point, but we are in a rising interest rate environment, and any temporary lulls don't indicate otherwise. Any borrowers fantasizing about July's pricing need to be realistic, what matters is the future, not the past, and the future is higher rates." -Ted Rood, Senior Originator, Wintrust Mortgage"Very little economic data today and rates continue to rise. We are still advising to lock in at application as we see nothing on the horizon that indicates a reversal of the current uptrend." -Alan Craft, Branch Manager, Prime Mortgage Lending"Lock when you can because waiting for a dip in rates will take a lifetime most likely. Lock when the quote is given for a refinance and when a contract is in hand or even verbally agreed to on a purchase. 5% here we come. Sub 4% never coming back. Reality is coming into picture and the last 12-18 months of super low pre May 2013 rates is a bad dream at this point." -Mike Owens, Partner, Horizon Financial Inc"Total breakdown of recent technical support levels leave us in a high risk scenario until the market decides the selling is overdone. With uncertainty in the timeline of FED tapering and a few weeks before the major employment report we can see this continue to drag out. Although yields have jumped substantially over the last week, inevitably the market will trade back down....I would hold off on locking today as the market should give something back over the next few days....Nonetheless, the consensus is to lock at origination." -Constantine Floropoulos, Quontic Bank
Today's Best-Execution Rates
- 30YR FIXED - 4.75%-4.875%
- FHA/VA - 4.25% or 4.75%
- 15 YEAR FIXED - 3.75%-3.875%
- 5 YEAR ARMS - 3.0-3.50% depending on the lender
Ongoing Lock/Float Considerations
- After rising consistently from all-time lows in September and October 2012, rates challenged the long term trend higher, but failed to sustain a breakout
- Uncertainty over the Fed's bond-buying plans is causing immense volatility in rates markets and generally leading rates quickly higher
- Fears about the Fed's bond-buying intentions were proven well-founded on May 22nd when rates rose to 1yr highs after the Fed indicated their intention to taper bond buying programs sooner vs later
- The June 19th FOMC Statement and Press Conference confirmed the suspicions. Although tapering wasn't announced, the Fed made no move to counter the notion that they will decrease bond buying soon if the economic trajectory continues
- Rates Markets "broke down" following that, as traders realized just how much buy-in there was to the ongoing presence of QE. These convulsions led to one of the fastest moves higher in the history of mortgage rates and market participants have not been eager to be the among the first explorers to head back into lower rate territory until they're sure they'll have some company.
- (As always, please keep in mind that our Best-Execution rate always pertains to a completely ideal scenario. There are many reasons a quoted rate may differ from our average rates, and in those cases, assuming you're following along on a day to day basis, simply use the Best-Ex levels we quote as a baseline to track potential movement in your quoted rate).
Voted Best Realtor and top finalist every year since 2013, it is easy to say that Dave Friedman is committed to his work. These prestigious awards, given to one realtor out of more than 6,000 in the ....
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