THE BASIS POINT

WeeklyBasis 04/02/07: Rates Up Slightly This Week

Fixed and ARM rates are up about .125% after a four week run with no changes. Given all the trouble with sub-prime loans in the first quarter, it’s great for borrowers that we start the second quarter with rates at very competitive levels. I should also note that, for borrowers with at least 20% equity and 700+ credit, I can go significantly lower than the 5yr ARM rates shown below (for jumbo and conforming). The biggest market moving news this week will be Friday’s jobs and wage growth report. This monthly report is critical because the jobs growth component shows overall health of both consumer and business sectors of the economy, and the wage growth component is a good barometer of inflation. Fed chairman Bernanke has made it clear that he’s a data-dependent decision maker, so it’ shard to predict any medium to long term Fed direction until we see more trends shake out of weekly and monthly data, as well as second quarter earnings and oil prices.

Conforming ($200,000 – $417,000) – NO POINTS
30 Year: 6.125% (6.265% APR)
10/1 ARM: 6.375% (6.515% APR)
5/1 ARM: 6.125% (6.275% APR)

Jumbo ($417,001 – $650,000) – NO POINTS
30 Year: 6.375% (6.515% APR)
10/1 ARM: 6.375% (6.515% APR)
5/1 ARM: 6.25% (6.4% APR)