Mortgage Minute: The Fears of Tapering Return

By Rob McNelis

With very little in the way of economic news released early in the week, investors seemed to error on the side of caution when deciding where to invest their money. The only report out today was the usually somewhat benign “ISM Services Index” (A national non-manufacturing index based on a survey of roughly 370 purchasing executives in industries including finance, insurance and real-estate (or FIRE), communications and utilities. It gets reported the third business day of the month at 10 a.m. Eastern. Data for prior month.) That came in better than expected giving investors a possible indicator that the all important Non Farms Payroll set to be released on Friday may also come in better than expected (which could lead to tapering from the Fed sooner rather than later). Though there needs to be way more positive data to lead the Fed to an early tapering decision, with little other news being released, this is all investors had to go on so Mortgage Bonds really took it on the chin. 

As I have previously pointed out that when Mortgage Bonds or MBS lose market share than home loan rates start to rise. That is why I am advising my clients to “lock in” their rate at least for the short term until MBS find a new level of support to lean on. Please watch the attached video to see where home loan rates are at today. If you would like to talk about your specific scenario or needs, please do not hesitate to call or email me directly.

This statement of current rates is not an offer to enter into an agreement for a loan at a specified interest rate, number of points or both. Current interest rates and discount points are subject to change at any time without notice to you. Stated rate examples were calculated using a $300,000 loan amount, 80% LTV and 720 Min Fico at the stated term lengths.  Licensed by the Dept. of Business Oversight under the Ca Res. Mtg. Lending Act.– 431-0421; Rates and charges in the advertisement do not apply to all loans made by the financial institution.

Rob McNelis
Loan Officer - NMLS# 830519
Direct: 619.279.6162
robm@summitmortgage.com
www.robmcnelis.com
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