Last week in review

Forwarded exclusively by:	Bob Rosenbaum The Rosenbaum Lending Group Office: (703) 879-5200 Email: Bob@MyTalentedLender.com website: www.MyTalentedLender.com NMLS#: 649782
Monday, September 23, 2013
What Happened to Rates Last Week? Mortgage backed securities (MBS) gained +130 basis points from last Friday's close which caused 30 year fixed rates to move to their lowest levels in the past 30 days. Mortgage backed securities were trading in a very narrow range until Wednesday's Federal Reserve Open Market Committee Meeting (FOMC). And they shocked bond traders by electing not to taper at that meeting.  While, our own internal survey showed that only 20% of over 4,000 originators polled expected a taper announcement, over 80% of bond traders and hedging operators did expect a taper announcement.  So, the fact that they made no taper announcement was unexpected by traders and a shock to the system.  As a result - MBS shot up just over +80 BPS just after the FOMC statement was released and then another +25BPS after Bernanke's press conference. Keep in mind that the Fed does not have to wait until their next meeting in December to take action.  The made it very clear that it is already part of their program - that they can change the size and nature of their asset purchase program ANY time that they want.  This has traders focused in on any economic news that would give the Fed enough ammunition to adjust their monthly bond purchases this year.  And this week we have some very big economic reports such as GDP, Durable Goods Orders and Consumer Confidence.  All of which will be very closely watched by traders.
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Forwarded exclusively by:	Bob Rosenbaum The Rosenbaum Lending Group Office: (703) 879-5200 Email: Bob@MyTalentedLender.com website: www.MyTalentedLender.com NMLS#: 649782
Friday, September 20, 2013
What happened yesterday? Mortgage backed securities (MBS) lost -11 basis points from Wednesday's close which caused 30 year fixed rates to move slightly higher. Initial Jobless Claims were much lighter than expected and the prior period was not revised upward as much as the market expected.  But traders largely ignored this report because the numbers are still tainted by the potential under reporting by two states. Existing Home Sales surprised to the upside coming in at 5.48 million units vs. market expectations of 5.25 million units.  Manufacturing in the Philly district was stronger than expected and the Leading Economic Indicators beat expectations.  The combined impact of these three reports was to pressure MBS lower. The stock market (DOW -40.39) and the MBS market (FNMA 4.0 -11BPS) once again moved in the same direction as they both sold off.
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Refi?

Yep - I said "Refi" ... If you missed the boat earlier - you might be in luck. 

Mortgage Backed Securities are up on the Fed's news that they will not begin tapering at this time.  

Your best bet for refinance is to consider going from a 30 to a 15 year note.  That will get you the most bang for your buck.  

If you're in a VA loan - call me today about lowering your rate/payment with a Streamline Refinance (no income, no assets!).

Bring it on!  I'm ready to help as many people as I can.  

Robert F. Rosenbaum, Jr. 

The Rosenbaum Lending Group
1st Portfolio Lending Corp.
8300 Boone Blvd., Ste 200

Vienna, VA 22182
(703) 879-5200  Office
(703) 608-1110  Cellular
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RRosenbaum@FirstPortfolio.com
http://www.MyTalentedLender.com 
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Kuntri Yonkwan

Loan Processor

(571) 327-2152 Office

(703) 564-9121 Fax

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It’s a good life!

The Fed meets today ...

After showing negative numbers in the past month or so, the Mortgage bankers Association reported that its Market Composite Index, a measure of total loan application volume, rose by 11.2% in the latest survey. The refinance index jumped by 18% while the purchase index rose by 3%. The recent rise in home loan rates is one of the main reasons for the recent drop off in applications.

Over in housing news, the Commerce Department reported that Housing Starts rose by 0.9% from July to August to an annual rate of 891,000 units. That was below the 910,000 that was expected - July was revised lower to 883,000 from 896,000. Building Permits, a sign of future construction, fell by 3.8% to 918,000 units, below the 943,000 expected. However, there was a surge in single-family Permits, a sign that the housing recovery is continuing.

The Federal Reserve's long awaited monetary policy statement will be released this afternoon at 2:00pm ET. There is no chance of the Fed raising the benchmark Fed Funds Rate, currently at 0.25%. However, the Fed can start to ease back on the $85 billion per month in Bond purchases. The Fed could announce a $10 billion to $15 billion reduction. The statement will be accompanied by the Fed's Economic Projections (forecasts) and a press conference with Fed Chairman Bernanke will follow at 2:30pm ET.

Market update - rates rise

Forwarded exclusively by:	Bob Rosenbaum The Rosenbaum Lending Group Office: (703) 879-5200 Email: Bob@MyTalentedLender.com website: www.MyTalentedLender.com NMLS#: 649782
Wednesday, September 04, 2013
What happened yesterday? Mortgage backed securities (MBS) lost -35 basis points from Friday's close which caused 30 year fixed rates to move upward.  In fact, yesterday's sell off completely erased all of the prior week's improvement. MBS sold off immediately after the release of the ISM Manufacturing data.  The market was expecting a reading of 54.0 and it came in at 55.7. A reading above 50 shows economic expansion (which is negative for your pricing) As a result, the benchmark FNMA 4.0 September coupon "tanked" to their worst levels of the day of -63BPS at 10:36EDT. Construction Spending was also better than market expectations (0.6% vs 0.3%) which was also negative for your pricing. But MBS climbed off of their bottom and started to regain some (but not all) of their early morning losses, rising from -63BPS to -39BPS on news that the Republican House Leader would support any action by President Obama against Syria.  This temporarily gave some momentum to the speculation that Obama will get the support he needs from Congress and then launch a strike against Syria.
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Prices rise but not for long as interest rates climb ...

Home sales, prices rise – but for how long?

Sales of existing homes rose in July to their highest level in three years, with year-over-year prices again showing double-digit increases.

The number of sales was 6.5% above June and 17.2% above the level in July 2012. If sales continue at the same pace, that would equal 5.39 million homes sold annually, according to figures from the National Association of Realtors.

Rising interest rates as well as rising prices are expected to tamp down both prices and the number of sales in coming months, as homes get less affordable. The shortage of homes for sale, particularly for first-time buyers, continues in many communities, too.

Post continues below

"Mortgage interest rates are at the highest level in two years, pushing some buyers off the sidelines," Lawrence Yun, the NAR’s chief economist, said in a news release. "The initial rise in interest rates provided strong incentive for closing deals. However, further rate increases will diminish the pool of eligible buyers."

The national median home price, including single-family and condos, was $213,500. That’s 13.7%  above the national median price a year ago and only 7.3% below the peak of $230,400 in July 2006.

• Foreign investors lose interest as home prices rise

The number of homes for sale increased 5.6% from June, to 2.28 million, which is a 5.1-month supply at the current rate of sales. The number of homes for sale is 5% less than a year ago.

Distressed homes continued to make up a smaller percentage of sales, one of the factors that is driving up median prices, since foreclosures and short sales sell at a discount. In July, distressed homes were 15% of sales, down from 24% a year ago.

• New data show uneven pace of housing recovery

First-time buyers continued to play a smaller role in the market than they do in normal times, accounting for only 29% of sales, down from 34% a year ago. Investors made 16% of purchases, down from a peak of 22% in February.

All-cash sales continued to be a strong factor, making up 31% of the deals, up from 27% a year ago.

Looking at the numbers by region:

• Northeast: Sales up 20.3% from July 2012, median price up 6.7%.

• Midwest: Sales up 20.8% from July 2012, median price up 9.5%.

• South: Sales up 16.6% from July 2012, median price up 13.6%.

• West: Sales up 13.2% from July 2012,  median price up 19.2%.

  
  

  By Teresa at MSN Real Estate

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, August 12, 2013
What Happened Last Week Mortgage backed securities (MBS) gained +0 basis points from last Friday's close which caused 30 year fixed rates to move sideways. So, for the past two weeks, MBS have moved only +8BPS which have kept mortgage rates fairly steady. Mortgage backed securities traded in a tight range and we avoided the major swings in pricing that we had in the prior week. We had light week in terms of the number of economic releases that hit the market and reports that were released were a mixed-bag. ISM Services came in much stronger than expected (56.0 vs est of 53.0) but Wholesale Inventories disappointed (-0.2% vs est of +0.2%). Initial Weekly Jobless Claims were very close to market expectations (333K vs est of 336K). So, the economic data didn't really drive our pricing last week. Instead it was Treasury auctions and Fed speak that were the major force in bond trades. We had three major U.S. Treasury auctions with the market focusing on the 10 year note and 30 year bond. Last week was all about the Fed and jobs. Both the 10 year and 30 year auctions came off weaker than their recent averages as measured by their bid-to-cover ratio but were still strong enough to keep MBS pricing up. Talking Feds: We had six different speeches by different Federal Reserve members, but few of them were voting members. Essentially, they all said the same thing: 1) the Fed needs to cut back their monthly bond purchases of Treasuries and mortgage backed securities, 2) it will most likely happen in 2013, 3) they need to see more economic improvement from the second half of this year before they move to taper and 4) they would not give a specific date for the first taper. The fact that there was no specific date for the Fed to begin tapering kept MBS at an elevated level which kept rates low. What's on the agenda for this week? Mortgage Rates Currently Trending: NEUTRAL We have a big week for economic data...but it won't start until tomorrow. MBS are moving upward this morning on speculation over the German GDP data due out this week. We only have one economic report this afternoon with our U.S. Treasury budget, and we do not have any major U.S. Treasury auctions this week. The rest of the week is packed with data about inflation levels (PPI and CPI) - these are most likely going to continue to show very tame inflation levels on a month-over-month basis. Tuesday's Retail Sales report and Friday's Consumer Sentiment Index will be the biggest reports of the week. Bottom Line: There may be some benefit to floating your interest rate and watching the market carefully. However, this is really a case by case decision and should be discussed with your Mortgage Professional. We are testing some technical resistance levels, and if we break above them it could benefit mortgage rates. If we bounce off of them though it could lead to rate deterioration very quickly. Monitor real time 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.                                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.
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