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Rate Update

The events in Greece last week reversed investors’ “flight to safety” movement, leading mortgage rates higher earlier in the week. Successful Treasury auctions later in the week led rates back down near their lowest levels of the year.  On Monday, The European Union (EU) and International Monetary Fund surprised investors with an announcement that they will make up to $1 trillion available to Greece and other EU members that are experiencing economic troubles. The commitment demonstrated by the stronger European countries toward their weaker neighbors calmed investor fears and funds once again moved back to riskier assets like stocks. In fact, the Dow Jones Industrial Average recovered over 400 points on Monday alone. The US Treasury long-term auctions were received very well last week, and led mortgage rates down despite the news from Europe. Given where rates are right now, it was not surprising to find out Mortgage Applications rose last week by 3.9%, with refinancing up 15% and purchases down 9.5% after the end of the federal home buyer tax credits. Currently, the 30-Year Fixed sits at 4.500% (4.648% APR) and the 15-Year Fixed is at 3.875% (4.137% APR). The monthly inflation reports are due out this week along with Housing Starts and Leading Economic Indicators.

Written by Central Coast Lending - Go to Central Coast Lending's Website/Profile