What's Ahead For Mortgage Rates This Week : October 9, 2012

Mortgage markets worsened last week for the first time in a month as the U.S. economy showed signs of improvement, and the Eurozone stepped closer to launching its $500 billion euro rescue fund.

Conforming mortgage rates in MD rose last week on the whole -- even though Freddie Mac's Primary Mortgage Market Survey proclaimed that they fell. 

This occurred because Freddie Mac's weekly mortgage rate survey is conducted between Monday and Tuesday each week and, last week, mortgage rates were lower when the week began. Through Wednesday, Thursday and Friday, however, they rose.

According to the Freddie Mac survey, the average 30-year fixed rate mortgage slipped to 3.36 percent nationwide last week, while the 15-year fixed rate mortgage fell to 2.69 percent. Both rates required 0.6 discount points and both marked all-time lows.

As this week begins, to gain access to the same 3.36% and 2.69% mortgage rates from last week, Rockville mortgage applicants should expect to pay more closing costs and/or higher discount points.

Improving U.S. employment data is partially to blame.

Friday morning, the Bureau of Labor Statistics released its September Non-Farm Payrolls report. More commonly called "the jobs report", the monthly issuance details changes in U.S. employment by sector and reports on the national Unemployment Rate.

In September, accounting for upward revisions to data from July and August, 200,000 net new jobs were created -- far exceeding Wall Street's estimates for 120,000 net new jobs created. Furthermore, the Unemployment Rate unexpectedly dropped to 7.8%.

Jobs are considered a keystone in the U.S. economic recovery. As a result, when the jobs numbers hit Friday, mortgage rates worsened, building on momentum built earlier in the week as Greece moved steps closer to accepting aid from the Eurozone.

In general, since 2010, weakness in the Eurozone has helped push U.S. mortgage rates lower. As Europe regains its footing, therefore, domestic mortgage rates are expected to rise.

This week, in a holiday-shortened week, there will be little new data to move mortgage rates. The Federal Reserve's Beige Book is released Wednesday and some key inflation data is due for Friday release. Beyond that, mortgage rates will continue to take cues from the Eurozone.

Mortgage rates remain near all-time lows.

What's Ahead For Mortgage Rates This Week : August 20, 2012

Mortgage markets worsened for the third straight week last week as the U.S. economy showed new signs of expansion, and as little new news came from Europe.

August has been a rough month for rate shoppers. Since the start of the month, mortgage rates in Bethesda have climbed steadily and are now at a 7-week high.

According to Freddie Mac's weekly Primary Mortgage Market Survey, the 30-year fixed rate mortgage is 3.62% nationwide, on average, for homeowners willing to pay 0.6 discount points plus a full set of closing costs. 1 discount point is equal to one percent of your loan size.

Homeowners not wishing to pay discount points are seeing 30-year fixed rate mortgage rates as high 4.00%.

These are the highest mortgage rates since Independence Day.

This week, mortgage rates may continue to move higher. There is a bevy of economic data set for publication in addition to the Federal Reserve's release of its July/August meeting minutes. Mortgage rates are expected to get more bumpy as the week progresses.

No data will be released Monday or Tuesday. During these first two days, expect momentum and sentiment to drive markets. Lately, both have favored "higher rates".

Then, Wednesday morning, the National Association of REALTORS® releases its July Existing Home Sales report. Strong numbers will likely lead mortgage rates higher. That is, until that day's 2:00 PM ET release of the Fed Minutes. This will be the week's big market-mover.

Prior to its last meeting, the FOMC had said economic stimulus would be warranted given certain conditions and Wall Street took that to mean that the Federal Reserve was close to adding new stimulus. When the Fed did not add said stimulus August 1 as expected, mortgage rates rose.

The Fed Minutes will provide insight into some of the debate the shaped the discussion/non-discussion of new stimulus and, depending on what market sees, mortgage rates may rise or fall Wednesday -- perhaps by a lot.

Then, on Thursday, the government releases its New Home Sales data for July. This, too, can influence mortgage rates.

If you're not yet locked on a mortgage, it may be prudent to lock your rate in. Mortgage rates have trended higher this month, and may continue to move in that direction.

What's Ahead For Mortgage Rates This Week : August 13, 2012

Mortgage markets worsened last week as the investors moved back into risk-taking mode. Better-than-expected economic data in the U.S. plus a general feeling that the ongoing Eurozone issues will be soon be resolved (or lessened) contributed to a second straight week of rising mortgage rates.

One such data point was the weekly Initial Jobless Claims report.

According to the U.S. Department of Labor, the number of U.S. workers filing for first-time unemployment benefits unexpectedly dropped 6,000 from the week prior on a seasonally-adjusted basis. Economists had expected a week-over-week increase.

In addition, government-backed mortgage securitizers Fannie Mae and Freddie Mac both announced quarterly profits last week of a combined $8.3 billion. This, too, reflects well on the economy because both companies attributed strong results to a recovering housing market.

Conforming rates in Washington, DC rose for the second straight week, according to Freddie Mac's weekly mortgage rate survey.

The 30-year fixed rate mortgage rate now averages 3.59% nationwide for mortgage applicants willing to pay 0.6 discount points plus a complete set of closing costs where 1 discount point is a loan fee equal to one percent of your loan size.  This is a 10 basis point increase from late-July, when rates averaged 3.49%.

The 15-year fixed rate mortgage also moved higher, registering 2.84% last week after recently posting at 2.80%, on average.

This week, there won't be much data to move markets. We'll see the release of the Producer Price Index and the Consumer Price Index -- two inflationary gauges for the U.S. economy -- as well as July's Retail Sales report. Beyond that, however, there won't be much. Therefore, be wary of day-to-day momentum in the mortgage bond market.

Between January and July, momentum took mortgage rates lower; eventually to an all-time low. Since August 1, however, that momentum has reversed.

If you're floating a mortgage rate or are otherwise not yet locked, get with your loan officer quickly. Mortgage rates may fall between today and Friday, but there's much more room for rates to rise instead.

What's Ahead For Mortgage Rates This Week : July 16, 2012

Mortgage markets improved last week on slowing economic growth worldwide and investor thirst for "safe" investments.

China's economy posted to its weakest growth since 2009 and economic activity in the Eurozone continued to sag. Both events resulted in a broad-based sell-off of equities and non-U.S. bonds. Mortgage bonds benefited from last week's flight-to-quality as bond pricing moved higher.

When mortgage bond prices rise, mortgage rates fall.

According to Freddie Mac, the average 30-year fixed rate mortgage rate is now down to 3.56% nationwide for borrowers willing to pay 0.7 discount points plus a full set of closing costs. The 15-year fixed rate mortgage fell to 2.86%, on average.

Both mortgage rates are all-time records, rewarding today's Rockville home buyers and mortgage rate shoppers. The principal + interest mortgage payment on a $200,000 mortgage is now just $904.80 per month.

Low rates may not last forever.

One reason why low rates may not last is that, also last week, the Federal Reserve released the minutes from its June 2012 meeting. In it, the Fed appeared more ready to add new market stimulus than Wall Street had expected. The market's initial reaction was to push mortgage rates higher because new stimulus would encourage risk-taking among traders, and invite inflation.

This week will see the release of a number of key data points for the U.S. economy :

• Monday : Retail Sales
• Tuesday : Consumer Price Index
• Wednesday : Housing Starts
• Thursday : Existing Home Sales; Initial Jobless Claims

If any of these reports show better-than-expected results, mortgage rates are expected to rise. In addition, Federal Reserve Chairman Ben Bernanke begins a 2-day congressional testimony beginning Tuesday. The chairman's words can move mortgage markets.

Mortgage rates remain at historical loans. If you have not yet locked a mortgage rate, talk to your loan officer soon.

What's Ahead For Mortgage Rates This Week : July 9, 2012

Mortgage markets improved last week as concerns for U.S. economic growth wrestled attention away, albeit temporarily, from the Eurozone. Mortgage bonds improved to record prices, lowering mortgage rates across MD and nationwide.

The biggest news of last week's holiday-shortened trading week was the Friday release of last month's Non-Farm Payrolls report.

In it, the Bureau of Labor Statistics showed that the economy added 80,000 net new jobs in June, and that the initial tallies for April and May were overstated by a combined two thousand jobs. Wall Street had expected to see at least 100,000 jobs created in June.

When the actual number of jobs fell short of expectations, stock markets sold off and bond markets gained.

According to Freddie Mac, last week's 30-year fixed rate mortgage rate averaged 3.62% nationwide for borrowers with conforming mortgages willing to pay 0.8 discount points at closing, plus a full set of closing costs.

For every $100,000 borrowed on a 30-year fixed rate mortgage, you'll pay just $456 per month -- the lowest in history.

15-year fixed rate mortgages averaged 2.89% with 0.7 discount points.

Both products set record-low mortgage rates, based on Freddie Mac's data. However, by the week's end, after the jobs report, both rates had moved lower still to the benefit of Bethesda home buyers and rate shoppers. 

This week, with little new economic data set for release, mortgage markets are expected to turn attention back to Europe. Early Monday, Greece's new government won a key confidence vote in Parliament which ends a period of uncertainty during which the nation-state was without a clear leader.

This is one step toward resolving the debt issues that have plagued Greece but not the last step. How markets respond to Greece's next actions will, in part, shape the direction of mortgage rates here in the United States. With optimism, mortgage rates will rise.

Should Greece falter, mortgage rates will fall.

Mortgage rates are expected to remain volatile for at least the next 3 weeks. If you're floating a mortgage rate or wondering whether it's time to lock a rate with your lender, consider locking in. With mortgage rates at 3.62% on average, rates have much more room to rise than to fall. 

Home Affordability Getting A Springtime Boost From Greece

Home affordability is receiving a boost from across the Atlantic Ocean this spring.

For the third time in as many years, a weakening Eurozone is pushing May mortgage rates to new lows throughout MD and nationwide.

The story centers in Greece and begins in 2010.

2 years ago, it was uncovered that successive Greece governments had purposefully misreported the nation-state's economic statistics in order to meet European Union standards. The fraudulent data had permitted Greek governments to spend beyond their means while hiding deficits from EU auditors.

The realization that Greece was heavy in debt with little means to repay its creditors resulted in a massive bailout from the IMF and the rest of the Eurozone nations. The terms for Greece said that, in order to receive its €110 billion aid package, Greece would be required to enact strict spending controls.

This is known as "austerity" and the deal was met with outrage by the Greek public. There's been general social unrest ever since and, on May 6 of this year, Greece held a special "early election" to elect all 300 members to its legislature.

No party won majority in the elections.

7 different groups garnered seats in the parliament last week with anti-austerity groups faring well. It's spurred concern that Greece will end its bid for fiscal restraint, and that Greece may choose to leave the 17-nation Eurozone.

The uncertainty surrounding Greece is helping U.S. mortgage rates to make new lows. As concerns mount for the future of Greece -- and the Eurozone, in general -- global investors seek safer markets for their money.

The U.S. mortgage-backed bond market is one such market.

With the implied backing of the U.S. government, mortgage-backed bonds are viewed as nearly risk-less and investors clamor for safety of principal during uncertain times. The boost in demand drives bond prices up and bond yields down, resulting in lower mortgage rates for home buyers and refinancing households of Bethesda.

So long as Greece struggles to form its government and flirts with a sovereign debt default, mortgage rates should continue to face downward pressure. U.S. rates may not fall week after week, but analysts expect any rise in rates to be muted.

What's Ahead For Mortgage Rates This Week : May 14, 2012

Mortgage markets worsened slightly last week as positive U.S. economic news overshadowed growing concerns for the Eurozone's future. Political and economic issues continue to weigh on Greece and Spain, and it's still unknown how France's new President will change that nation's fiscal direction. 

Conforming mortgage rates in VA edged higher on the week overall.

Last week was light on economic data, but the figures released suggest an improving U.S. economy.

For example, the Bureau of Labor Statistics reported 3.7 million job openings nationwide this past March, marking the highest amount since July 2008. Voluntary separations (i.e. "quit jobs") increased, too -- also at levels not seen since 2008.

Voluntary separations may hint at labor market improvement because employees rarely leave a steady-paying job without the prospect of a new job ahead. Furthermore, the four-week moving average of first-time unemployment claims fell for the first time in a month.

The jobs market is one of two key sectors expected to lead the economy forward this year.

The other is housing and, this week, there will be two key housing reports for Wall Street to review. The first is Tuesday's homebuilder confidence survey from the National Association of Homebuilders. The second is Wednesday's Housing Starts data for April.

Mortgage rates may also be affected by the Tuesday release of the Retail Sales report and Consumer Price Index report; and, by the Federal Reserve's Wednesday release of the FOMC Minutes from its last meeting.

For home buyers and mortgage rate shoppers, mortgage rates remain at all-time lows. According to Freddie Mac, the average 30-year fixed rate mortgage rate nationwide is 3.83% for borrowers willing to pay 0.7 discount points and a full set of closing costs -- the lowest rate-and-fee combination in Freddie Mac's recorded history.

However, low mortgage rates may not last much longer -- especially if the Eurozone can reverse course on its ailing economies.

Mortgage rates remain volatile and sensitive to changes in market conditions. If today's mortgage rates fit your budget, consider locking in.

What's Ahead For Mortgage Rates This Week : May 7, 2012

After two weeks of no change, mortgage markets improved last week, pushing mortgage rates lower throughout VA.

The majority of the improvements occurred Friday after the April jobs report failed to impress Wall Street, and after it became clear that the Eurozone's struggles with sovereign debt would continue.

According to Freddie Mac, conforming 30-year fixed rate mortgage rates fell to 3.84% nationwide, on average, for borrowers willing to pay 0.8 discount points at closing plus a full set of closing costs. 

1 discount point is equal to 1 percent of your loan size such that one discount point on a $200,000 loan would require $2,000 to be paid at-closing.

Freddie Mac's reported rates for the benchmark 30-year fixed rate mortgage are the lowest in recorded history.

The 15-year fixed rate mortgage is also at its lowest point in history. According to Freddie Mac's survey, the 15-year fixed averaged 3.07% with 0.7 discount points last week. One year ago, the rate was 3.89%.

This week, with a data-sparse economic calendar, mortgage markets will likely take cues from events in Europe. Notably, France has elected a new leader, one that prefers growth over austerity; and voters in Greece have "punished" austerity-backing leaders, in the process creating a split parliament.

Each event adds uncertainty to an already unstable economic environment and uncertainty favors U.S. rate shoppers.

Doubt spurs investors to seek "safe" assets and U.S. government-backed bonds -- including mortgage backed bonds -- meet that criteria. As demand for mortgage bonds rise, mortgage rates tend to fall.

This week, rates are starting the week improved. Whether it's a knee-jerk reaction to Eurozone news from the weekend, or low rates are here to stay is tough to know. Therefore, if today's mortgage rates look good to you, consider locking something in. There's more room for rates to rise than to fall.

What's Ahead For Mortgage Rates This Week : April 9, 2012

In a week of up-and-down trading, mortgage markets improved for the second consecutive week last week. Weaker-than-expected jobs data plus evidence of a slumping Eurozone took mortgage bonds lower, capped by a furious Friday morning rally that dropped mortgage rates to near-record levels.

Once again, volatility ruled the bond pits.

Tuesday afternoon, after the release of the Fed March Minutes, mortgage rates spiked. Some products climbed as much as 0.250 percent. The surge stemmed from the Fed Minutes showing Federal Reserve members hesitant to begin new rounds of market stimulus without a demonstrated, national economic slowdown. 

Wall Street hadn't expected the Fed's verbiage to be so well-defined. With little evidence that such a slowdown was underway -- the economy has shown two straight seasons of consistent, steady growth, after all -- equity markets rallied and bond markets sunk, causing mortgage rates to rise.

By Wednesday, however, rates had started to fall. 

Civil unrest in Spain plus concern that the nation will fail to meet its debt obligations drew global investors away from equities and into the relative safety of U.S. government-backed bonds -- including mortgage-backed bonds. This is a common investment pattern during times of economic uncertainty and one of the major reasons why mortgage rates have been so low, for so long.

If the scenario in Spain sounds similar to what transpired in Greece between mid-2010 and late-2011, that's because it is. Mortgage rates in DC may benefit in the medium-term.

Also helping rates last week was the March jobs report.

The U.S. government reported 120,000 net new jobs created in March, well short of the 200,000 figure that analysts expected. Market sold off sharply on the news, giving rate shoppers another chance to capture low rates.

This week, with the economic calendar light, look for Europe to dictate market action. Mortgage rates may move lower but there's more room for rates to rise than to fall. Rates remain near all-time lows.

What's Ahead For Mortgage Rates This Week : February 13, 2012

Mortgage markets were mostly unchanged last week as Greece -- once again -- was front-of-mind for Wall Street investors. The nation-state is attempting to avoid a debt default, and has been attempting to avoid default since May 2010.

Early in the week, Greece reached a deal with European Union leaders to secure additional financial aid. By Friday, however, the deal was in doubt, as the EU leaders declared that the Greek Parliament would have pass new austerity measures before the aid would be released.

Austerity measures have been unpopular in Greece, giving rise to riots among citizens and resignations among politicians. Markets responded to the potential undoing of the debt deal by seeking safety in bonds -- including U.S. mortgage-backed bonds.

The Greek debt default story has helped fuel low mortgage rates in VA. Once a final deal is reached, mortgage rates are likely to rise.

For now, though, mortgage rates remain at all-time lows.

According to Freddie Mac's weekly mortgage rate survey, the average, conforming 30-year fixed mortgage rate held firm at 3.87% last week for mortgage borrowers willing to pay an accompanying 0.8 discount points plus applicable closing costs. 1 discount point is equal to one percent of your loan size.

For borrowers unwilling to pay discount points and/or closing costs, average mortgage rates are higher.

This week, data returns to the U.S. economic calendar.

Greece will still be in play, but the health of the U.S. economy will determine in which direction mortgage rates will go. There are two inflation reports due -- the Consumer Price Index and the Producer Price Index.

The former is a "cost of living" indicator for U.S. households; the latter measures the same for business. Inflation is bad for mortgage rates so if either report comes in unexpectedly high, mortgage rates are likely to rise.

The same is true for Tuesday's Retail Sales report.

Retail Sales account for close to 70% of total U.S. economic activity. An unexpectedly strong Retail Sales figure will suggest that the domestic economy is improving and that, too, would pressure mortgage rates up.

If you're shopping for a mortgage, or floating one with your lender, consider locking in this week. Mortgage rates don't have much room to fall and there's much room to rise.

What's Ahead For Mortgage Rates This Week : February 13, 2012

Mortgage markets were mostly unchanged last week as Greece -- once again -- was front-of-mind for Wall Street investors. The nation-state is attempting to avoid a debt default, and has been attempting to avoid default since May 2010.

Early in the week, Greece reached a deal with European Union leaders to secure additional financial aid. By Friday, however, the deal was in doubt, as the EU leaders declared that the Greek Parliament would have pass new austerity measures before the aid would be released.

Austerity measures have been unpopular in Greece, giving rise to riots among citizens and resignations among politicians. Markets responded to the potential undoing of the debt deal by seeking safety in bonds -- including U.S. mortgage-backed bonds.

The Greek debt default story has helped fuel low mortgage rates in VA. Once a final deal is reached, mortgage rates are likely to rise.

For now, though, mortgage rates remain at all-time lows.

According to Freddie Mac's weekly mortgage rate survey, the average, conforming 30-year fixed mortgage rate held firm at 3.87% last week for mortgage borrowers willing to pay an accompanying 0.8 discount points plus applicable closing costs. 1 discount point is equal to one percent of your loan size.

For borrowers unwilling to pay discount points and/or closing costs, average mortgage rates are higher.

This week, data returns to the U.S. economic calendar.

Greece will still be in play, but the health of the U.S. economy will determine in which direction mortgage rates will go. There are two inflation reports due -- the Consumer Price Index and the Producer Price Index.

The former is a "cost of living" indicator for U.S. households; the latter measures the same for business. Inflation is bad for mortgage rates so if either report comes in unexpectedly high, mortgage rates are likely to rise.

The same is true for Tuesday's Retail Sales report.

Retail Sales account for close to 70% of total U.S. economic activity. An unexpectedly strong Retail Sales figure will suggest that the domestic economy is improving and that, too, would pressure mortgage rates up.

If you're shopping for a mortgage, or floating one with your lender, consider locking in this week. Mortgage rates don't have much room to fall and there's much room to rise.

What's Ahead For Mortgage Rates This Week : February 6, 2012

Mortgage markets worsened last week as domestic job growth surprised Wall Street and the Eurozone moved yet one more step closer to reaching a lasting Greece sovereign debt solution.

Conforming mortgage rates in DC rose on the news, although you wouldn't know it from looking at Freddie Mac's weekly mortgage rate survey.

According to Freddie Mac, the average 30-year fixed rate mortgage rate fell to 3.87% last week with 0.8 discount points due at closing, plus closing costs. 1 discount point is a fee equal to one percent of your loan size.

3.87% for a 30-year fixed rate mortgage is the official, all-time low for the weekly Freddie Mac survey, conducted since the 1970s. However, because Freddie Mac gathers its results on Monday and Tuesday only, by the time the survey results were released Thursday morning, mortgage rates were already rising off their lows.

Then, Friday morning, after January's Non-Farm Payrolls data was released, mortgage rates surged.

The January jobs report exceeded expectations in nearly every fashion possible :

• Economists expected to see 135,000 jobs created in January. The actual number was 243,000.
• Economists expected to see the Unemployment Rate at 8.5% in January. The actual number was 8.3%.
• Revisions added an additional 180,000 net new jobs to the original 2011 tally.

As compared to one year ago, there are 2.1 million more people employed in the U.S. workforce. Figures like this hint at a stronger national economy, and that tends to drive mortgage rates up.

This week, with little economic data due for release, mortgage rates are expected to move on momentum. Right now, that momentum is causing rates to rise.

If you're shopping for a mortgage rate in Bethesda and want to know if the time is right to lock, consider that it's impossible to time a market bottom, but simple to spot a "good deal".

Mortgage rates remain near historical lows -- it's a good time to lock one in. Call your lender today. 

What's Ahead For Mortgage Rates This Week : January 30, 2012

Mortgage markets improved last week as news from the Federal Reserve, the U.S. economy, and Europe combined to spur new demand for mortgage-backed bonds.

Conforming mortgage rates rallied from Wednesday through Friday's close, ending the week near all-time lows set earlier this year.

Last week's rally was sparked by the Federal Open Market Committee.

After its first meeting of the year, Chairman Ben Bernanke & Co. changed its projection for "exceptionally low rates" to at least late-2014. Previously, the Fed had said its benchmark Fed Funds Rate would remain low until 2013.

This, in conjunction with the Fed's message that further economic stimulus may be coming, led Wall Street investors to increase their bets on mortgage bonds, pushing up prices and pushing down yields.

Lower yields means lower rates.

Mortgage rates were also helped lower by mixed data on the U.S. economy including weaker-than-expected housing reports, and another setback in the Greece sovereign debt negotiations.

Each time that Eurozone leaders have failed to reach an expected accord with Greece since 2010, mortgage rates have dropped. Last week was no different.

This week, with a large amount of U.S. economic data due for release and a high-profile summit among European Union leaders, mortgage rates are poised to move. Unfortunately, we can't know in which direction.

Some of the news that will move markets include :

• Monday : Personal Consumption Expenditures
• Tuesday : Consumer Confidence; Case-Shiller Index
• Wednesday : Construction Spending
• Thursday : Weekly Jobless Claims
• Friday : Non-Farm Payrolls;Factory Orders

Of all of the economic releases, Friday's Non-Farm Payrolls has the most potential to move markets. More commonly called "the jobs report", Non-Farm Payrolls details the monthly change in national employment and the national Unemployment Rate. 

Jobs are believed to be the key to U.S. economic recovery so strength in jobs should result in higher mortgage rates throughout MD and the country.

Mortgage rates remain very low. If you're nervous about mortgage rates rising this week or next, it's as good of a time as any to lock your rate with a lender, and start moving toward closing.

What's Ahead For Mortgage Rates This Week : January 23, 2012

The outlook for the U.S. economy improved last week, taking the mortgage bond market with it. For the first time this year, conforming mortgage rates rose throughout MD from one week to the next.

Data was strong across all categories last week.

• Home Resales :Existing Home Sales rose 5%
• New Homes : Single-Family Housing Starts rose 4%
• Builders : Home Builder Confidence rose to a 5-year high
• Jobs : Jobless claims fell to lowest level since April 2008
• Inflation : CPI remained in balance

In addition, European leaders moved closer to a final resolution on the Greek sovereign debt default situation.

Overall, the action gave investors reason for optimism in the U.S. economy, and economies abroad. This drew money away from the U.S. mortgage bond market, which caused mortgage rates to rise.

Freddie Mac reports the average 30-year fixed rate mortgage slipping 0.01 percentage points to 3.88% nationwide, with an accompanying 0.8 discount points and complete set of closing costs. These costs are slightly higher as compared to the week prior.

1 discount point is equal to one percent of the borrowed loan size.

Freddie Mac's weekly mortgage rate survey puts the conforming 30-year fixed rate mortgage under 4 percent for 7 consecutive weeks.

This week, mortgage rates may rise; the week is anchored by a 2-day Federal Open Market Committee meeting. Whenever the FOMC meets, mortgage rates can be volatile.

The Ben Bernanke-led FOMC is not expected to raise the Fed Funds Rate from its current target range near 0.000 percent, but it's not what the Fed does that can change mortgage rates as much as it is what the Fed says. 

After its 2-day meeting concludes Wednesday, the FOMC will issue its customary statement to the markets, to be followed by a press conference led by Chairman Bernanke. Wall Street will watch the press release and conference for clues about the Fed's next steps and its outlook for the U.S. economy.

If the Fed indicates that the economy is growing, mortgage rates in Washington, DC are likely to rise. Conversely, if the Fed indicates that the economy is slowing, mortgage rates are likely to fall.

Other factors influencing mortgage rates this week include the President's annual State of the Union address (Tuesday), the Pending Home Sales Index (Wednesday) and New Homes Sales data for December (Thursday).

Mortgage rates remain low but may not stay that way. If you're looking for the best rates of the year, this week may be your chance.

What's Ahead For Mortgage Rates This Week : November 28, 2011

Mortgage markets worsened slightly last week through a bouncy, holiday-shortened trading week. Markets were closed Thursday for Thanksgiving and re-opened only briefly Friday.

As in past weeks, though, economic, political, and financial news from the Eurozone dictated the direction of U.S. mortgage-backed bonds.

As Greece -- and now Italy -- have faltered, investors have sought to preserve their respective principal, moving money from unsafe assets to safe ones, a class which includes Fannie Mae- and Freddie Mac-backed mortgage bonds.

This investment pattern is known as "safe haven" buying and it's why mortgage rates tend to improve when large economies grow unstable. Government mortgage bonds are considered among the safest securities available.

The average 30-year fixed rate mortgage is available for 3.98%, according to Freddie Mac, with borrowers expected to pay an accompanying 0.7 discount points. 1 "discount point" is a loan fee equal to 1 percent of your loan size.

"No-point loans" carry higher rates than the Freddie Mac-published figures, but come with lower closing costs.

This week, there are several reasons to expect mortgage rates to rise throughout MD.

First, markets are speculating that the IMF will lend Italy 600 billion euro to help avert financial crisis. This move would reverse the safe haven buying that's characterized the last few weeks of trading, thereby leading mortgage rates higher.

A second reason is that they are early reports that Black Friday shoppers out-spent analyst estimates. Consumer spending is the largest part of the U.S. economy so, if spending is up, the economy should be up, too. 

As before, this would reverse some of the safe haven buying that's helped keep mortgage rates low.

Lastly, this week is stuffed with new data including Friday's always-important Non-Farm Payrolls report. Wall Street expects 116,000 net new jobs created in November. If the actual figure is much higher, mortgage rates will rise.

Expect mortgage rates to be volatile this week. Your quoted mortgage rates could vary by as much as a quarter-percent from day-to-day. If you're nervous about losing a low rate that's been offered to you, consider locking in.

What's Ahead For Mortgage Rates This Week : October 3, 2011

Mortgage markets deteriorated last week as optimism for a Greek rescue package increased, and as U.S. consumers showed that, despite falling income levels, spending will not be slowed.

As reported by the government, household income dropped in August, falling 0.1 percent and marking the first monthly dip since 2009. Yet, consumer spending still rose, tacking on 0.1 percent. Consumer spending accounts for 70 percent of the U.S. economy.

In addition, last week Eurozone leaders approved a funding increase for the European "bailout fund". The additional funding raises the probability that Greece will avoid default on its sovereign debt, and that other nations including Italy, Spain, Ireland and Portugal will avoid similar default scenarios.

The moves drew money away from mortgage markets, causing rates to rise.

Conforming mortgage rates in DC climbed last week, stymying would-be refinancers in search of the lowest mortgage rates in 60 years. Nationally, fixed rate mortgages were higher by as much as 0.25%.

This week, rates may continue climbing.

First, European leaders are expected to finalize the details of a Greek aid package, a move that would reverse the "safe haven" bid which has played a large role in keeping U.S. mortgage rates lows.

Second, the jobs report is due.

Economists are expecting 65,000 net new jobs in September and a slight increase in the Unemployment Rate. A deviation from either consensus expectation should cause mortgage rates to move. 

If it's shown that more than 65,000 jobs were created last month, mortgage rates should rise on the prospect of a recovering economy. To the contrary, though, if it's shown that fewer than 65,000 jobs were created, mortgage rates should fall.

The jobs report will be released Friday morning, 8:30 AM ET.

If you're shopping for a mortgage right now, be aware that rates could move in either direction, but there's a lot more room for rates to rise than to fall. The "safe" course of action is to lock a rate today.

 

What's Ahead For Mortgage Rates This Week : September 26, 2011

Mortgage markets improved last week as the Federal Reserve provided new market stimulus and the Eurozone continued to grapple with Greek's sovereign debt issues.

Conforming mortgage rates fell in VA last week overall, dropping for the second straight week.

For rate shoppers, the best day on which to lock a mortgage rate last week proved to be Thursday.

Fresh off the Federal Reserve's Wednesday afternoon announcement that the group will launch a $400 billion program in support of longer-term bonds, mortgage rates fell. This occurred because mortgage rates are based on the price of mortgage-backed bonds, and mortgage bonds are a beneficiary of the Fed's new program.

Those gains were short-lived, however, because Friday morning, when the market opened, mortgage bonds were deteriorated, and that momentum carried through to the afternoon.

By the time the markets closed for the weekend, nearly all of the Fed-led gains had been drained from mortgage bonds.

Within a matter of 48 hours, the average 30-year fixed-rate mortgage rates had plunged -- then surged -- 0.250 percent.

The speed at which rates changed underscores how tough it can be to shop for a mortgage these days. If you were quick on Thursday, you locked your rate at its low. If you "slept on it", though, or even took too much time to think, you not only missed the best mortgage rates in more than 50 years, you missed it by entire quarter-percent.

On a $200,000 mortgage, that's an approximately monthly payment difference of $30 per month.

This week, mortgage rates should be similarly volatile. There is a lot of economic news set for release, and the Eurozone is rumored to have a plan to save Greece from debt default.  Depending on the strength of said data, and the passage of a Greek default plan, just how mortgage rates will change is unknown.

If you're shopping for mortgage rates, the safe path is to lock what you can. Mortgage rates may fall this week, but what if they don't? Rates have a lot farther to rise than to fall.

What's Ahead For Mortgage Rates This Week : September 19, 2011

Mortgage bonds worsened last week as Eurozone default fears eased abroad, and expectations for a domestic stimulus increased. 

Mortgage rates rose for the first time in three weeks last week, pushing conforming and FHA mortgage rates in VA off their all-time, historical lows. Rates were at their lowest Tuesday morning, then rose through Friday's afternoon closing. 

Markets open this week with an eye toward the world's central banks.

In the Eurozone, central bankers (continue to) discuss the debt burdens of Greece and whether a coordinated intervention is necessary. Without it, some economists believe that the nation-state will default on its sovereign debt, which would then create additional financial stress within other nations in the region.

Italy is included among those countries.

In the United States, central bankers are making equally-important choices. 

The Federal Open Market Committee will emerge from a 2-day meeting Wednesday and is expected to announce new stimulus for the U.S. economy.

Since 2009, the Federal Reserve has twice stimulated the economy via an open-market, bond buying initiative. The programs created demand for mortgage bonds which, in turn, lowered mortgage rates for U.S. homeowners. If the Fed chooses this path a third time, expect for mortgage rates to fall in Washington, DC.

If the Fed's sponsored stimulus is something else, however -- or if the Fed choose to do nothing -- mortgage rates may rise.

There is economic data due this week, including the Existing Home Sales and Housing Starts report, but it will be the world's central bankers that sit in spotlights. 

Expect volatile mortgage rates this week. Wall Street can only guess what governments will do to stimulate their respective economies and can lead to wild swings in pricing. The "safe play" is to lock a rate while we're still near all-time lows.

Once rates reverse higher, they're expected to rise quickly.

What's Ahead For Mortgage Rates This Week : September 12, 2011

Mortgage markets improved last week as a weakening Eurozone and questions about the U.S. economy sparked a global flight-to-quality. Conforming and FHA mortgage rates improved for the second week in a row.

The storylines should sound familiar by now. They are the same ones that have dictated the path of mortgage rates since April 2011. As a result, according to Freddie Mac, mortgage rates across DC and nationwide are now at an all-time low.

Not in 50 years of tracking mortgage rates has pricing been so favorable.

Last week's holiday-shortened week didn't begin well for rate shoppers in Rockville. Rates moved higher on the expectation of additional economic stimulus from two separate parts of the government -- the Federal Reserve and Congress. 

Wall Street held high hopes for Ben Bernanke's address to the Economic Club of Minnesota, and for the President's address to a joint session of Congress. It expected Fed Chief Bernanke to reveal clues about the Fed's next move; and it expected the President to unleash a massive jobs creation program that would put more Americans to work.

Both outcomes would have harmed mortgage rates as money flowed into stocks. However, neither happened. Bernanke kept mum on the Federal Reserve's options and the White House announced a jobs program smaller in scope than was expected.

Mortgage rates fell throughout the day Thursday then received a big boost Friday.

Amid rumors of a pending Greek default and the potential credit downgrades of several Eurozone banking groups, safe haven buying picked up and drove mortgage rates down.

Markets open this week with rates lower than they've ever been in history.

There isn't much new data set for release this week so market expectations will continue to set the direction in which mortgage rates go. If concerns for a Eurozone default rise, mortgage rates should fall. Conversely, if Eurozone chatter settles, mortgage rates should rise.

For now, mortgage rates remain at all-time lows and should not be taken for granted. If you see a rate that makes sense for you, consider locking it in.

What's Ahead For Mortgage Rates This Week : September 6, 2011

Mortgage markets improved last week on a weak jobs report, expectation for new market stimulus, growing evidence of a global economic slowdown. Rates were especially volatile, too, with the long Labor Day Weekend looming.

Overall, conforming mortgage rates in MD improved for the first time in 3 weeks. On a product-by-product basis, though, mortgage rates are faring differently.

According to the Freddie Mac weekly mortgage rate survey, last week, the 30-year fixed rate mortgage was unchanged but the 15-year fixed rate mortgage and the 5-year ARM fell.

The 5-year ARM is at a new all-time low for qualified borrowers.

A drop in 5-year ARM rates throughout Bethesda without a corresponding drop in 30-year fixed mortgage rates signals that markets expect the economy to stabilize over the long-term but with weakness in the near-term. The 5-year ARM's ultra-low rates suggests marked weakness ahead.

The 5-year ARM may get another boost this week, too.

While U.S. markets were closed for Labor Day, Eurozone nations were hit with new wave of sovereign debt concern, this time centered on Italy. Greece, Portugal and Ireland have already been the subject of debt default debate this year. Italy's inclusion hit equity market hard and safe-haven buying re-commenced.

This should give a good start to mortgage rates this week. Look for rates to start lower. That's not to say, however, that they'll finish the week lower. With very little economic data due for release, markets will move on momentum and momentum can change in a flash.

The two biggest potential market movers both come Thursday. Fed Chairman Ben Bernanke speaks in Minnesota at 1:00 PM, and United States President Barack Obama addresses the nation at 7:00 PM. Both speeches are highly anticipated and should cause markets to move.