Last week and the week ahead ...

Forwarded exclusively by:	Bob Rosenbaum The Rosenbaum Lending Group Office: (703) 879-5200 Email: Bob@MyTalentedLender.com website: www.MyTalentedLender.com NMLS#: 649782
Monday, July 29, 2013
Pending Home Sales Climb 10.9% Pending Home Sales climbed 10.9% from this time last year according to the National Association of Realtors (NAR).  Pending Home Sales are homes that have active sales contracts but have not yet closed. On a month-over-month basis, sales pulled back -0.4 percent.  This is actually positive news as the market was expected a drop of over 1.00% due to higher mortgage rates during this term.  The fact that the housing market is able to absorb the slight uptick in mortgage rates is good news. Based on year-to-date sales activity, and stable contract signings expected for the balance of the year, NAR projects existing-home sales to rise more than 8 percent in 2013.  Inventory shortages will lead the median price to rise by nearly 11 percent this year.                                        Last Week's Mortgage Rate Recap Last week mortgage backed securities (MBS) lost -49  basis points from last Friday's close which caused 30 year fixed rates to move higher.  This ended the bond rally that had lasted for the two weeks prior to last week. As we have discussed, MBS sell off when there is positive economic news.  We certainly could have sold off even more given last week's data with Durable Goods Orders much stronger than expected (4.2 vs 0.5) and the Consumer Sentiment Index rising from 84.1 to 85.1.  Existing Home Sales missed the market expectations but was still robust.  New Home Sales enjoyed some nice gains in terms of unit sales and price increases. Demand for our 7 year Treasury auction saw some decent demand but our 5 year and 2 year auctions saw decreased demand. MBS would have lost more ground (even higher rates for you) if it weren't for a WSJ article that speculated that the Fed would change their language at this week's FOMC meeting to calm the markets that they would not be increasing their rates for a long time.  We agree.  They will certainly leave their Fed Funds rate alone but they will eventually have to start to pull back on bond purchases and those bond purchases are what impacts your mortgage rates...not their Fed Fund rate. This Week's Mortgage Rates Forecast Mortgage Rates Currently Trending: HIGHER Expect much more volatility this week as traders watch the plethora of economic data that is released this week - and all of it with the potential to move the markets.  Week to week now, the common theme seems to be the markets watching to see what the Fed may do about withdrawing/tapering QE3.  Strong news bodes well for the growth of the economy but may hasten the Fed's move out of QE3; weaker news keeps the Fed from tapering but emphasizes the weaknes in the economy.  An ugly catch-22 no matter how you look at it. BOTTOM LINE:  It's a good time to have an interest rate lock/float conversation with your Mortgage Professional.  Some scenarios make it easy to advise to lock, others make it more of a time to float.  Talk with your Most Trusted Mortgage Professional to decide what options are available and what actions may be right for you.  Whatever you decide, be prepared for a roller coaster week full of volatility.  Be sure to stay tuned to live market data with your Mortgage Professional to stay a step ahead of lender reprices and to cash in on market gains that help mortgage rates. Be prepared for any negative market performance that could push mortgage rates higher.                                        RateAlert’s Most Trusted Mortgage Lending Professionals: Loan Professions that subscribe to RateAlert Executive services have the training and market knowledge at their fingertips, along with live trading data during market hours to expertly help navigate the difficult and often times confusing process of understanding rate movements and which factors may cause volatility when considering whether or not to lock. If you’d like to learn more about what things to consider when timing the market in an effort to obtain the best interest rates, don’t hesitate to contact the person who sent you this commentary. This commentary has been sent to you by the Mortgage Loan Originator (MLO) above because they thought you may find it interesting or helpful. The views and opinions offered do not necessarily represent the views of your MLO. Please contact them with any questions or to find out more about the information listed herein and how to work with them
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