Mortgage Rates: Week Ended February 1

Mortgage bonds (aka MBS) that rates are tied to opened materially better (rates down) after this morning’s January jobs report, then reversed to end the day in the red (rates up). Rates closed today even vs. last week. Technicals suggest the rate spike may level off next week, but with the 10yr Note closing above 2%, there’s still risk of more MBS selling and higher rates.

Rates as of Friday’s close below, which are .375% higher than record lows last touched 1/15 and 1/16. We were in that record low range for much of the fourth quarter, but there’s no real technical evidence we’ll see those levels again soon.

It’s worth noting that the rate spike applies to conventional loans in the first two “conforming” tiers below (the loans to $417,000 and to $625,500). The jumbo loans from $625,501 to $2m and the FHA loans are more steady because the MBS markets for those loans are a bit more favorable.

Also below is a link to my daily commentary along with the MortgageNewsDaily MBS team and Barry Ritholtz’s quick list of the week’s good and bad U.S. economic events/data.
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CONFORMING RATES ($200,000 to $417,000) 0 POINT:
30 Year: 3.625% (3.745% APR)
FHA 30 Year: 3.25% (3.37% APR)
5/1 ARM: 2.75% (2.87% APR)

SUPER-CONFORMING RATES ($417,001 to $625,500 cap by county) 0 POINT:
30 Year: 3.875% (3.995% APR)
FHA 30 Year: 3.375% (3.495% APR)
5/1 ARM: 2.75% (2.87% APR)

JUMBO RATES ($625,501 to $2,00,000) 1 POINT:
30 Year: 3.5% (3.62% APR)
10/1 ARM: 3.125% (3.245% APR)
5/1 ARM: 2.5% (2.62% APR)

Lower or higher rates apply to specific borrower and property profiles. Lower or higher rates available using tax deductible points or zero-cost transactions. These rates assume full doc pricing on Single Family Home purchase loans for borrower with 740 FICO score or greater, at least 20% equity (unless FHA), and 6-12 months reserves left over after close (retirement assets counted at 60% of value for reserves). ARM rates adjust the first month after initial fixed period shown, and once per year thereafter until year 30. Adjusted rate calculated by adding 2.25% margin to 1yr LIBOR index at time of adjustment. At first adjustment LIBOR+margin cannot exceed start rate+5%, subsequent yearly adjustments can never be greater than 2% per year, total of all adjustments for 30yr life of loan can never exceed start rate+5%. Jumbos shown as range since they’re less market sensitive and change randomly based on lender pricing competition. Rates based on loan amount ranges shown and rates available at the time of production. Rates aren’t a loan commitment nor a loan guarantee, and are subject to change without notice.

*Conventional Super-Conforming cap = $625,500. FHA Super-Conforming cap = $729,750.
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Reference:
- Rates Retreat To Recent Highs After Volatile Market Movements (MortgageNewsDaily)

- Succinct Summation Of The Week’s Events (Barry Ritholtz, The Big Picture)

- $MBB, $TLT

 
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