The Home Loan Mortgage Blog

Weekly Update - 3/4/22

March 4th, 2022 11:09 AM by T. Fanning

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Hey, I hope you’re doing well!

 

Rates had a nice drop this week, ending with a fairly sizeable decrease. Next week has far fewer scheduled events that are expected to affect mortgage rates than this week did. It appears there are only two monthly economic reports, albeit one is an extremely important inflation reading. There are also a couple of Treasury auctions that we will be watching. All of the week's relevant events take place during the mid and latter days.*

 

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: 3/4/22

 

Friday's bond market has opened up sharply as geopolitical concerns in Ukraine take centerstage in the markets again. Stocks are in selling mode with the Dow down 465 points and the Nasdaq down 187 points. The bond market is currently up 30/32 (1.73%), which should improve this morning's mortgage rates by approximately .375 - .500 of a discount point if compared to Thursday's early pricing.

 

Today's major economic release was February's Employment report from the Labor Department. They announced a 3.8% unemployment rate for February while 678,000 new jobs were added to the economy. The unemployment rate was lower than the 3.9% that was expected and the payroll number was well above forecasts of 395,000. Both readings indicate strength in the employment sector, making them bad news for bonds and mortgage rates.

 

One very bond-friendly piece of data from the report was average hourly earnings that were unchanged from January's level. This was much softer than the 0.5% rise analysts were expecting to see and raised eyebrows. Nearly all analysts were predicting rising wages as employers need to raise pay to fill job openings. Wage inflation contributes to broader inflationary pressures in the economy that makes bonds less appealing to investors, leading to higher mortgage rates. Therefore, we can consider the lack of another increase to be favorable news for rates. It will be interesting to see if February's reading is revised upward in next month's update.

 

The headline numbers from the release are mixed with important readings coming in both positive and negative for rates. It is worth noting that bonds were already posting noticeable gains long before the report was released. They started to rally yesterday afternoon but extended those late gains during overnight trading as news broke that Russia had attacked a nuclear power plant in Ukraine that was now on fire followed by reports of elevated radiation levels. The ongoing war is raising concerns about global economic growth, causing stocks to sell and funds to shift into bonds.

 

Next week has far fewer scheduled events that are expected to affect mortgage rates than this week did. It appears there are only two monthly economic reports, albeit one is an extremely important inflation reading. There are also a couple of Treasury auctions that we will be watching. All of the week's relevant events take place during the mid and latter days. 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.
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*https://www.homeloanmortgageco.com/DailyRateLockAdvisory
                  

Company NMLS ID: 479289 | LO NMLS: 208694

CO License: 100008854

FL Company License: MBR4416 | FL License: LO89221

 

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www.nmlsconsumeraccess.org

Posted by T. Fanning on March 4th, 2022 11:09 AM

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