Ryan’s Mortgage Blog Part 2:
I stated last night rates were slightly up…BUT I should have been more specific. While the average rate may have gone up with a majority of lenders, that doesn’t mean all of the lender’s rates went up. Being a brokerage we have the ability to shop hundreds of lenders/banks to find the lowest rates out there. Granted when rates steadily increase or decrease they will eventually do so with all the lenders. In a case like the last couple weeks when rates were only slightly up, not all lenders followed suit. This was brought to my attention this morning when our company priced out a 5 year arm (interest only) at 5.625% and a 7 Year Arm (I/O) at 5.75%. Both of these rates are below what many news sites have the current rates at.
Another thing to note is lenders anticipate what is going to happen in the market and they price things into their rates ahead of time, so just because something happened on Wall Street today doesn’t mean rates will change today because lenders anticipated this two weeks ago and adjusted their rates then.
Next week I will talk about the pros and cons of using a brokerage over a direct lender/bank. RBaker@PeregrineLending.com