The Home Loan Mortgage Blog

Weekly Update - 1/14/22

January 14th, 2022 12:33 PM by T. Fanning

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Hi, happy Friday.

 

Rates were quiet this week, ending very similar to last Friday's numbers. Next week doesn't have too much scheduled that is likely to drive mortgage rates. The week starts with the markets closed Monday for the Martin Luther King Jr. holiday. We only have a couple of monthly economic reports set to be posted, with the majority being housing related. There also is a 20-year Treasury Bond auction midweek that could affect rates during afternoon trading one day.*

 

We offer Conventional, FHA, VA, USDA, Jumbo and regular construction financing. Some of our niches include: Chenoa Fund loans; FHA and VA 1x Close Construction-Perm; 1.50% Down FHA Advantage Program; CHFA Financing; HomeStyle renovation program; and a Jumbo, 5% down program. We also can do hobby farms, Ag properties and Alt-A (stated income, verified assets for self-employed borrowers)! To see a detailed list of programs, visit our website: www.homeloanmortgageco.com/mortgageprograms

 

As always, please let me know if I can help you, your friends/family/potential buyers/borrowers!


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Last Updated: 1/14/22

 

Friday's bond market has opened well in negative territory despite quite favorable results from today's economic reports. Stocks are mixed with the Dow down 161 points and the Nasdaq up 41 points. The bond market is currently down 16/32 (1.75%), which should push this morning's mortgage rates higher slightly. Preventing more of an increase are gains from late yesterday. If you saw an intraday improvement before closing, you may see a larger increase this morning.

 

The first of today's batch of economic reports was the highly important Retail Sales report for December. The Commerce Department announced a very weak 1.9% decline in consumer sales, falling well short of the unchanged that was expected. Even more surprising was the 2.3% drop in sales if more volatile and costly auto transactions are excluded, when a 0.2% rise was predicted. There are theories floating as to why this happened (lack of supply in stores is one), but there is no debating that consumers spent far less last month than many had thought and great news for bonds and mortgage rates. Because consumer spending makes up two-thirds of the U.S. economy, this should be concerning in how it may affect overall economic growth in the coming months, supporting the thought process that the worst of this spike in rates is likely behind us.

 

Next was December's Industrial Production data at 9:15 AM ET. It revealed a 0.1% decline in output at U.S. factories, mines and utilities last month. Forecasts were calling for a 0.3% increase in production. As a sign of weaker than expected manufacturing activity, we can label this report as favorable for mortgage rates also.

 

The final report of the week was January's preliminary reading of the University of Michigan's Index of Consumer Sentiment at 10:00 AM. It came in at 68.8, down from December's final 70.6. The lower reading means surveyed consumers don't feel as confident about their own financial situations this month as they did last month. Waning confidence usually translates into softer consumer spending levels (see this morning's Retail Sales report). Therefore, we can consider the report slightly favorable for bonds and mortgage pricing.

 

Next week doesn't have too much scheduled that is likely to drive mortgage rates. The week starts with the markets closed Monday for the Martin Luther King Jr. holiday. We only have a couple of monthly economic reports set to be posted, with the majority being housing related. There also is a 20-year Treasury Bond auction midweek that could affect rates during afternoon trading one day. Look for details on all of next week's activities in Sunday evening's weekly preview.

 

If I were considering financing/refinancing a home, I would....


Lock if my closing were taking place within 7 days...
Lock if my closing were taking place between 8 and 20 days...
Float if my closing were taking place between 21 and 60 days...
Float if my closing were taking place over 60 days from now...
 

This is only my opinion of what I would do if I was financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.*

 

*http://www.hlmcolorado.com/DailyRateAdvisory
              

Company NMLS ID: 479289 | LO NMLS: 208694

CO License: 100008854

FL Company License: MBR4416 | FL License: LO89221

 

Regulated by the Colorado Division of Real Estate

www.nmlsconsumeraccess.org

Posted by T. Fanning on January 14th, 2022 12:33 PM

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