This is pretty interesting because this is the other direction than what the experts thought Operation Twist would have on the market. John Murphy pointed this out earlier on his post, then tonight I saw the St Louis Fed had updated their 30year mortgage average rates.
There are 2 things I find really interesting here but can’t explain.
1) the spread gets larger between the mortgage rates and the 10 year treasury the lower the treasury goes.
2) the 10 year treasury is going up, when most thought it would go down as a result of Operation Twist.
Note: the 30 year mortgage is updated as of 10/13/2011. The 10 year treasury is updated as of 10/11/2011 at 2.18%
Just curious what Edina Realty Mortgage rates are today… Looks like they are heading up.
Image via CrunchBase
WOW! This puts things into perspective a bit. We all complain about the banks on their underwriting and that they are “not lending” now. I knew they were pummeled with new regulations but had no idea to what extent.
The nation’s 11th largest mortgage servicer and 13th largest mortgage originator is getting out of the business due to excessive regulations according to HousingWire. If a company can walk away from a$115.9billion servicing business it has to be bad…
MetLife Bank, a division of insurer MetLife Inc. (MET: 31.75 0.00%), is selling the bank’s mortgage business, citing uncertainty in the marketplace and a regulatory environment that requires excessive resources.
…In 2010, MetLife Home Loans ranked as the 11th largest mortgage servicer in the U.S., with its servicing business valued at $115.9 billion in the fourth quarter. The company also ranked 13th on the list of mortgage originators, holding 1.4% of the market and originating roughly $22 billion in mortgages last year.
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This not the direction we should be heading in to improve the housing market. Having more banks lending would be helpful, not banks walking away from the business…
Mortgage rates hit record low of 3.94%: Freddie.
Report from HousingWire that the 30 year fixed rate mortgage average is down to 3.94%.
The average rate for a conventional 30-year, fixed-rate mortgage dropped below 4% for the first time in history amid increasing global concerns, according to Freddie Mac.
Today’s rates from Edina Realty nudged up a bit from yesterday, I suspect these will dip back down.
Bill allows tax-free use of retirement funds for mortgage payments.
This is interesting, a bill that would allow a homeowner to tap into their retirement funds without the normal 10% penalty to cover their mortgage payments. Interesting how it is only for Fannie Mae and Freddie Mac mortgages…
We will have to see if this bill becomes law.
I wonder if this is the reason Minnesota ranked # 1 in the Nation for Mortgage Fraud? 20% still seems high to me for denial rate. I would assume someone may not qualify for the best interest rates, but may be able to put into a higher rate mortgage instead rather than just simply denied.
This story is Edina Realty, just re-posting:
The majority of homebuyers who sought home loans in Minnesota last year were approved, according to analysis from the Wall Street Journal. In fact, the newspaper’s findings show the state had the lowest mortgage application denial rate in the country in 2010 for homebuyers seeking a new mortgage as well as homeowners trying to refinance an existing mortgage.
According to the research, which looked at data from the nation’s 10 largest mortgage lenders, Minnesota’s home loan application denial rate was 19.9 percent last year. The average rate for the entire nation was 26.8 percent – up markedly from 2009’s level of 23.5 percent.
Minnesota was the only state with a mortgage application denial rate lower than 20 percent, the Journal says.
Minnesota was the only state with a mortgage application denial rate lower than 20 percent, the Journal says. The mortgage application denial rate for Wisconsin and North Dakota was 23 percent and 21.1 percent, respectively – both lower than the national average.
In addition to the positive mortgage application acceptance rate in Minnesota, home loan interest rates have stayed near the same levels as at the beginning of 2011, making this year a premier time to purchase homes for sale in the state.
I had been posting every business day on the 10 year treasury and the 30 year mortgage since the announcement of Operation Twist. The reason why I am posting info on the 10 year treasury is that the 30 year fixed rate mortgage tends to track closely. It is not tied directly together, but the 10 year treasury is used as a guide for banks when they buy and sell mortgages.
Earlier this week the 10 year treasury started moving higher. The 30 year fixed rate followed upwards. Yesterday I got busy and forgot to track these and sure enough – the 30 year fixed rate mortgage rate dropped today.
The 10 year treasury nudged down a bit today as did the 30 year fixed rate mortgage. The national average rate for a 30 year fixed rate mortgage today is 4.01%. This chart below shows the average 30 year fixed rate mortgage compared to the 10 Year Treasury. The 30 year mortgage rate data is updated as of 9/29/2011, the 10 year treasury is updated as of 9/27/2011 at 2.01. (today it closed at 1.96)
click to enlarge
Now let’s look at where Edina Realty Mortgage Rates are today.
Image by Rev Dan Catt via Flickr
Still watching the 10 Year Treasury to see if there is any indication that rates might come down. Today the Dow soared 272 points to close over 11,000. This is great news by itself…
The 10 Year Treasury rose 5.31% closing at 1.9040. Keep in mind, even though it increased – it is still extremely low.
The 10 Year Treasury is heading in the wrong direction to bring mortgage rates even lower, but as you can see the 10 year Treasury moves a lot more than the mortgage rates do. The 10 Year treasury may yet drop and bring the mortgage rates down. Time will tell. As of today, the 10 year treasury is going up and the mortgage rates have not changed: (oh bummer, we appear to be stuck at record low interest rates.)