Refinancing With Recent Mortgage Rates Volatility

This BLOG On Refinancing With Recent Mortgage Rates Volatility Was UPDATED On August 1, 2017

Mortgage Rates Volatility Concerns:

Mortgage Rates Volatility is a major concern for homeowners who are planning on refinancing or those who are in the refinance mortgage process.

  • Loan Officers should pay attention to locking mortgage rates before it is too late.
  • Mortgage Rates can go up and down, however, if rates go up and does not make a correction, the refinance process is pretty much over.
  • The time and cost of the appraisal can go down the drain if homeowners who are refinancing already ordered a home appraisal and did not lock their rates.

Mortgage Backed Securities

Mortgage backed securities tumbled again on Friday causing turmoil in the mortgage markets.

  • The mortgage backed securities market tanked by more than 200 basis points which marked the steepest one day drop in recent mortgage back securities history.
  • Mortgage Rates have never been so volatile.

Mortgage Backed Securities Versus Mortgage Rates Volatility

When mortgage backed securities drop and with mortgage rates volatility, mortgage rates rise.

  • Friday marked the biggest rise in mortgage rates in a single day. 
  • We have witnessed the biggest single day mortgage rates increase in a single day in history. 
  • Mortgage rates has seen the sharpest increase in history the past several weeks.
  • Even with the holiday week, mortgage backed securities plummeted 255 basis points. 
  • The previous two weeks, mortgage backed securities dropped 314 basis points. 
  • Mortgage rates have risen 0.5% the past few weeks on almost all mortgage loan programs. 
  • Mortgage rates have rose for the 9th consecutive week.

Better Than Expected Employment Report Adds Fuel To The Fire

Friday’s employment report came in better than expected which plummeted mortgage backed securities.

  • This rallied the stock market and it was great news for the economy but the end result was mortgage rates rising. 
  • Labor analyst forecast 160,000 new jobs in June but records show that 195,000 jobs were added. 
  • Revisions of past months added an additional 70,000 jobs. 
  • However, the unemployment rate remained at a constant 7.6%.

Highest Mortgage Rates Volatility Since The Great Recession

The majority of the major banks were quoting mortgage rates just under the 5.0% mark for conventional conforming mortgage loans.

  • FHA mortgage rates were at 4.3875%. 
  • Just a little over a month ago, FHA mortgage rates for a 30 year fixed rate mortgage was 3.25%.

Get Re-Qualified For Mortgage If Pre-Approval Is More Than Several Weeks Old

Mortgage Borrowers who have been pre-approved for a mortgage loan and need to go back to mortgage loan originator and get re-qualified for a mortgage loan if mortgage rates are substantially higher.

  • Chances are borrowers will no longer be pre-qualified for the mortgage loan amount loan officer first quoted due to the rise in mortgage rates.
  • Higher mortgage rates means higher monthly payments which affect debt to income ratios.

Borrowers who need to get qualified for mortgage at today’s volatile mortgage rates, please contact The Gustan Cho Team at 1-800-900-8569 or email us at gcho@gustancho.com. We are available 7 days a week, evenings, weekends, and holidays.

Related> Mortgage Rates Out Of Control

Related> Mortgage Bonds And Mortgage Rates

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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