Mortgage Rate Alert
This is a very important post for anyone looking to buy a home or refinance a mortgage. As you can see the 10 Year Treasury Note yield is in a free fall. When the 10 Year Note yield drops this is good for mortgage rates. My guess, based on technical data, is that rates won’t go much lower. My target on the 10 Year Note yield had been 3.9% and we are there. It is a possibliity that we could see the Treasury Note Yield test the 3.7% range.
What is curious is that the 30-year fixed rate mortgage has dropped about a half a percent in the last couple of days without a corresponding drop in the 10 year Treasury Note yield. I’ve been asking myself why?
Mortgage rates have not been dropping, until recently, even though rates on the 10 Year Treasury Note yield have been falling considerably. My guess is that investors are coming back into the prime mortgage market and feeling more secure now that the Government is talking about helping those borrowers in the sub prime market that are dragging the economy lower.
Less risk in the prime mortgage market means lower rates.
All I know is that last week the 30 Year Fixed rate mortgage was being quoted at 6.125% with an APR of 6.396% now we are seeing 5.5% with an APR of 5.671% and this is a dramatic change.
The stock market is still in turmoil and with the possibility of a recession it would not surprise me if the Dow Jones tests the recent low of 12,750. Should we break that number it could get very ugly. Be cautious, protect your assets.
On the Oil Market I would suggest that this recent weakness may continue, a break below $89 would suggest that oil could drop to $80. Better than $100!
I love to hear comments and hope that you will pass them my way.
Hoping that you are having a great time getting ready for the Holdiay Season.
