Colorado Home Mortgage Loan

GDP growth came in at .6% which is only .1% higher then the expected.  When expectations are exceeded investor confidence is high.  When investor confidence is high investors tend to pull money out of Mortgage Backed Securities and into Stocks.  This will cause Colorado Home Loan rates to increase as the price of bonds decrease.  This was not the case today, primarily because it did not beat expectations by much and more importantly the current GDP level still sucks.  Colorado Home Loan rates will be unaffected by the higher numbers here.  With in the GDP report you have a number of variables that are analyzed to get GDP numbers.  Durable and Non-Durable goods spending was down and reported lower then any reading since 1991.  We had a recession going on during this time.  Colorado Home Loan rates tend to improve on this type of information.  In fact all of the numbers in the GDP report came in much lower then expected except for Services spending which was the only variable to show any type of growth.  It also was the only reason we had GDP come in higher then expected.

Chicago’s PMI reported a bit higher then expected as well.  The expectation was 47.5 and the data came in at 48.3.  Again, not enough to make any major shifts in the Colorado Home Loan market.  Remember from a previous blog that when the index number comes in below 50.0 manufacturing actually experiences a contraction in the market.  If GDP contracted it would be defined as a Recession (just though you should know).  So even though PMI reported higher it still reported contraction.  Contraction in manufacturing causes concerns for economic growth.  These concerns send investors back to buying safe investments like Mortgage Backed Securities.  When Security demand is up, Colorado Home Loan rates drop.  So all in all, this report did not surprise anyone enough to make the Colorado Home Loan market move.

We did have one inflationary report come out and that was Employment costs.  It was projected to be up .8% however it came in at .7%.  Not much of a difference, but it does send a signal that inflation is not getting out of control.  Anytime I report good inflation numbers I want to put a little caution as it relates to oil.  Oil will be the thorn in our markets foot.  Colorado Home Loan rates will be impacted by inflationary pressures due to oil.  It is inevitable, to what extent will still be determined.  Regardless this report will have a positive impact on Colorado Home Loan rates.

Finally, we did have one employment report come out.  Like all employment reports it is a survey done by an independent survey company.  Some employment reports have significant credibility like the Bureau of Labor Statistics and some have less credibility.  ADP employment numbers indicated an increase in jobs by 10,000 for April, though not always accurate can give us a preview of what may come.  High Job numbers indicate economic recovery and in return cause the demand for Mortgage Backed Securities to drop.  As a result Colorado Home Loan rates will go up. 

Looking at all the reports that are out today and waiting in anticipation of what will be released by the Federal Open Market Committee it is clear why Colorado Home Loan rates appear to be flat right now.  I just checked the Mortgage Backed Securities ticker and it appears we are slightly up in price.  This means a slight improvement for Colorado Home Loan rates.  Not enough to make the rate change, but at least a good directional indicator.  The FOMC will certainly create movement later today and it appears that investors are standing by in anticipation of this information.  I will keep you posted on the information released and for the time being will continue to keep our FLOAT recommendation for Colorado Home Loan rates.  We are in for a bumpy ride, but waiting can pay off in the long run.  If you are not prepared for the ride we should have locked you yesterdayJ  At this point you are buckled in and we a hearing the clanks of the rollercoaster as it goes up the ride.  We are hoping that we hear the sweat sound of air blowing through our hair as we ride the coaster down.  The FOMC will be the deciding factor for this.  In the mean time Good Luck and Call me with your Colorado home loan questions.

I am predicting that the Economic Reports tomorrow will report GDP and Chicago PMI at or below expectations.  These reports if my projections are accurate will cause Colorado Mortgage Rates to drop below the current pricing floor.  This drop will allow us to secure our rate of 5.75%.   This will also open up the door for risk takers to drop below 5.75% over time.  We saw some continued improvements with Colorado Mortgage rates throughout the day, but much of the gain saw this morning was lost again by this afternoon.  The late day loss was due to investors concern about what these two  economic reports will actually say.  With everything we have seen in the market so far, I cannot imagine these reports showing any type of improvement in the market.  The problem is where investors have set the bar.  The bar continues to show expectations far below normal ranges.  Basically the market expects bad data.  If the numbers come in at or below expectations, investors will move to buy Mortgage Backed Securities.  This in return will improve Colorado Mortgage Rates.  

The only other movement we will see in Colorado Mortgage Rates will be the markets interpretation on the FOMC (Federal Open Market Committee) meeting.  The FOMC will release a variety of statements indicating their plan to stimulate the economy.  The FOMC will be expecting another .25% decrease in short term interest rates.  Interest rate decreases help the economy, but tend to be bad for mortgage backed securities.  When Short term interest rates are decreased, investors begin to be concerned with inflation, causing negative ripples in the Mortgage Backed Securities market.  With this said we will continue our FLOAT recommendation until tomorrow.  We are still projecting a decrease in Colorado Mortgage rates through the week.  Though the interpretation on what will be said by FOMC members can impact rates negatively, we just don’t see that happening tomorrow.  Inflation is what we need to watch for.  As each Member of the FOMC board begins to leak information we will all be keeping our ears open for inflation talk.  If the talk is light, Colorado Mortgage Rates will improve.  If for some reason great concern is raised for inflation by the board we will need to prepare for an immediate lock, as rates will certainly rise. Negative inflation news will send Colorado Mortgage Rates back into an uphill climb.  It is up for interpretation, but if the FOMC does anything surprising the market will react negatively.  We can just about get you 5.75% and expect that to be a reality tomorrow.  So far we are implementing another FLOAT recommendation because of how close we are to 5.75%.  LOCKING in the next couple of days may take the risk out of the market but floating for 10 days may get us under the 5.75% we have been so set on breaking through.  Stay tuned and remember to call me for your Colorado Mortgage questions. 

Colorado Home Mortgage Refinance Loan Rates will be impacted by 4 economic reports Tuesday and Wednesday.  Consumer Confidence, Advanced GDP, Chicago PMI, and Finally information coming out of the Federal Open Market Committee meeting.  All of the data coming out of these reports will send signals to the market indicating economic stability.  As you know this information is vital to the pricing of Colorado Home Mortgage Refinance Loan Rates. 

Consumer Confidence has a direct correlation to consumer spending, which accounts for two thirds of the economy. Consumer Confidence also has some correlation with joblessness, inflation, and real income. Typically only changes of five points or more are considered significant with higher numbers pointing to greater consumer spending. There are other pressures that change consumer spending other than consumer confidence, inflation, joblessness, and regional business issues. Consumer Confidence is used to predict the direction of Consumer Spending but because of other influences, higher Confidence won’t always lead to higher Spending.  This report will have an impact on Tuesdays Colorado Home Mortgage Refinance Loan rates.

Colorado Home Mortgage Refinance Loan rates are also influenced heavily by advanced GDP.  GDP is a significant report for several reasons. It is the most encompassing picture of economic activity and when paired with the employment report gives a picture of productivity growth. The data is used to define business cycle peaks and troughs. Higher GDP points to accelerated inflation while lower GDP indicates a weak economy.

The Chicago PMI is measured by new orders, production, supplier deliveries, inventories and employment; asking for positive, negative or unchanged readings of each. A reading above 50% generally indicates that the manufacturing sector is expanding, and below 50% signifies contraction.  So far this year manufacturing shows signs of contracting.  Contraction in manufacturing is considered bad for the economy, but good for Colorado Home Mortgage Refinance Loan rates.

Finally the Federal Open Market Committee meet to determine new monetary policy direction for our financial markets.  So Far the Federal Reserve action has been to lower interest rates, which by 99.9% of Americans means interest rates are falling.  THIS IS NOT TRUE.  Lower short term rates means more liquidity more liquidity means more spending.  When the economy spends more it does stimulate the economy, but it also has very negative influences on inflations.  We all should know by now that high inflation means Colorado Home Mortgage Refinance Loan Rates will suffer.  We expect the information coming out of Wednesday Federal Open Market Committee meeting to signal a .25% short term interest reduction.  Anything higher will cause Colorado Home Mortgage Refinance Loan Rates to increase out of fear for inflation. 

I have Colorado Home Mortgage Refinance Loan rate information posted at www.coloradomortgagebanking.com/news  In the mean time let me know of any Colorado Home Mortgage Refinance Loan Rate questions you might have.  FLOAT remains our recommendation and you can read more about that at the site listed above.  Best of luck and seem my post tomorrow sometime after 1pm.

Colorado Home Loan Rates hit 6.0% today for the first time in 6 months.  Though the rate appears to be disappointing we have yet to hit our 12 month high.  Colorado Home Loan Rates spiked as high as 6.25% back in November and it appears that rates today will be hitting its ceiling of residence at least for the moment.  Given the current market condition it appears that we may be seeing some relief in the weeks to come.  Over the last couple of days I have been writing about Colorado Home Loan rates and how Corporate profits have dominated investor behavior, while Economic reports have been ignored.   Well we finally had a report come in so poorly today that it could not be ignored any further.  Colorado Home Loan rates rebounded a bit, but not enough to change current Colorado Home Loan interest rates.  What did happen is that the upward climb we have been facing with Colorado Home Loan rates have finally stopped, at least for the time being. Colorado Home Loan rates started the morning in negative territory due to overnight selling of Mortgage Backed Securities.  It appeared that we were going to have another terrible day, but finally we had an economic report come in so low investors could no longer ignore it.  As a result we have seen Colorado Home Loan rates make up for a majority of the losses experienced in overnight trading.   Consumer Sentiment numbers were expected to come in low, so we were not surprised by preliminary reports indicating low expectations in this category.  What was surprising to investors was how low Consumer Sentiment actually came in at.  We now have people believing that we are in the toughest economic cycle since 1982.  This negativity for the economy will translate into better Colorado Home Loan rates over the next few days.  We should keep a close eye on our next report which will be The Consumer Confidence Report due out on the 29^th.  This report mirrors Consumer Sentiment and given the preview we got today investors may be more likely to buy Mortgage Backed Securities sooner then later.  This sudden increase in demand will translate into a momentum shift which should push Colorado Home Loan rates back down a bit.  Let’s not forget about our big reporting day, April 30^th.  No matter how you look at it we have some market moving activities in store, the question is how will it impact your Colorado Home Loan rate?  We believe that better rates are on the horizon and because we feel rates will come down will maintain our FLOAT recommendation.  We are moving up our Lock rate recommendation from 5.5% to 5.75%.  We expect Colorado Home Loan rate reductions over the next week or so, but we do not believe that we will hit the 5.5% for at least 60 days.  This means that if you are closing in the next 60 days and we can lock you in at 5.75% we should probably go ahead and lock it in.  We will make the Colorado Home Loan rate lock recommendations directly to you when rates hit the 5.75%.  For a faster response stay tuned to my blog at both sites and I will update you immediately when we have a Colorado Home Loan LOCK recommendation in force.  In the mean time God Bless and have a safe weekend:-)

Colorado Mortgage rates continued it’s up hill climb today.  So far Mortgage Backed Securities are reporting about .25% increases in Colorado Mortgage rates.  The news over the last few days has not been favorable to Mortgage Backed Securities. There are a number of reasons why this may be taking place, but it certainly reminds me of exactly how difficult it can be to project exactly where Colorado Mortgage rates are going.  In last 3 weeks we have seen Colorado Mortgage rates increase and increase and it just does not appear that we have any relief in sight.  All the Economic data coming in during the last 3 weeks should have been favorable to Colorado Mortgage rates; however that has not been the case.  1Q profit reports seem to be the driving force over the last 3 weeks leaving economic data for the back page of your local newspaper.  So the question today will be how much longer will Colorado Mortgage rates go up? And what will the rate be at its high point?  Most of my clients have been quoted between 5.75% and 6.0% with the condition that we would monitor a lock request at 5.5%.  Colorado Mortgage rates don’t appear to be heading in that direction in the next 45 days.  I still believe that we are at a high point assuming that we have no major surprises in the stock market (Like Ambac see www.coloradomortgagebanking.com/news). We have some slow days ahead as it relates to economic data, and most of the companies have reported their profits for 1Q, so we should see the momentum return to a more predictable approach.  We have 3 big reports coming out on April 30^th all of which will impact the market.  The biggest report of the three will be GDP which so far has reported positive production numbers.  If this report comes in lower then expected we will see rates improve.  Consumer sentiment and Consumer Confidence comes out tomorrow, both of which should come in low.  So assuming the stock market news keeps itself out of the headlines, rates should improve and FLOATING remains my recommendation.  It is a bit scary to see where we are at compared to 6 weeks ago, but I have said this many many times, we are not out of the woods yet! We will see bad economic data continue to make the headlines and when this happens Colorado Mortgage Rates will get better.  With that said, I am changing the Lock Floor Recommendation from 5.5% to 5.75% still a good rate, but hitting that 5.5% in the next 30 days will be out right difficult.  Call me with any of your Colorado Mortgage questions. 

Daniel

Colorado Home Mortgage Loan rates continue to be the center of attention for those buying homes in the near future.  I am asked constantly about how I determine where rates are going.  Simply put I make an educated guess based on the economic data and the live pricing feeds I have into the Mortgage Backed Securities market.  It is actually very simple to predict the direction Colorado Home Mortgage Loan rates will go.  If the Mortgage Backed Securities market indicates that the prices on bonds are increasing then the rate on Colorado Home Mortgage Loans will decrease.  Likewise, if the Mortgage Backed Securities price decreases Colorado Home Mortgage Loan rates will increase.  The economic data released into the market projects the state of the economy today.  If the economy shows signs of improvements Mortgage Backed Securities will drop in price.  The reason they drop in price is due to investors moving money out of safe Mortgage Backed Securities investments and into high risk stock investments.  Colorado Home Mortgage Loan rates will certainly increase when money is moved out of Mortgage Backed Securities market. 

Over the last 9 Months the economic news has been very negative which in return has put Colorado Home Mortgage Loan rates into a very pleasing price range.  It seems like everyone I talk to wants and expects to get their rate into the 5.5% range which has been the low points over the last 9 months.  We have experienced this low point about every 60 days or so.  It really depends on what the trend in the Mortgage Backed Securities market is and how investors are reacting to the economic data being released.  Inflation continues to be the negative influencer for Colorado home Mortgage Loan rates.  The mere fact that it is mentioned normally has Colorado Home Mortgage Loan rates moving in the wrong direction.  The key to locking is to figure out when the low point will happen before you actually close on your loan. 

So far we are trending around 5.875% which is still good for Colorado Home Mortgage Loan rates, but we certainly would like to get a little lower.  So far today the Mortgage Backed Securities market has not responded well and it appears at least this morning that investors believe that the Durable goods report will come in better then expected.  I am still not convinced and as I stated on my other blog www.coloradomortgagebanking.com today’s pricing trends normally predict what’s in store for the economic data being released the next day.  We will have to watch for a late day rally to see if any insider information makes its way into the market.  Rates will certainly be a little worse today, based on what I am seeing in the market.  Though rates will jump a bit we are still holding strong on our FLOAT recommendation, no need to overreact with the market.  If Durable Goods come in below expectations we will see some positive changes in the Colorado Home Mortgage Loan rate market.  Stay tuned I will update you on live market pricing as it happens. 

Right now the Mortgage Backed Securities market is not responding the way we would like.  On the news front Ambac posted a 1.7 Billion dollar loss.  Ambac is a bond insurer and losses with this company signals instability in Mortgage Backed Securities.  This will probably be the reason Mortgage Backed Securities take some hits today.  Colorado Home Mortgage Loan rates increased to its highest point in 6 months the last time a bond insurer company reported losses.  Today we will not see the news effect the market as much because of all the other turmoil we are experiencing in the stock market.  Company after company continues its lower then expected profit reports which will help minimize the decreases felt from Ambac news.  Stay tuned, today will be an interesting day.  We expect Colorado Home Mortgage Loan rates to improve over time, but today will not be that day.  Hopefully the economic data released tomorrow will push out the negative press on Ambac and help get Colorado Home Mortgage Loan rates back where locking makes sense.

. We had another up and down day today as it relates to Colorado home mortgage refinance loan rates.  The Mortgage Backed Securities market started the day up and is now showing only moderate gains.  This should have a small positive impact on Colorado home mortgage refinance loan options.  We are seeing a lot of investors that are buying Mortgage Backed Securities and immediately selling them off at a small gain.  These Profit seekers normally do not make a big impact in the market but volume continues to be low.  Colorado home mortgage refinance loan rates continue to see improvements day after day.  We will Keep our FLOAT recommendation in place.  We are hoping that the news on Thursday pays off.  Durable goods report is expected to come in low, but if it is anything like last months report we will see Colorado home mortgage refinance loan rates drop even further.  We are already seeing much of the increases experienced in the last two and half weeks disappear.  Stay tuned and be ready to lock your Colorado home mortgage refinance loan rate when the recommendation comes into play.  In the mean time we will ride the wave and report on any big movements in the market as they happen.  Best of Luck and keep in touch.

Daniel

Colorado Home Mortgage Loan rates should see some improvements this week.  I just got done looking at the Mortgage Back Securities market and we are right where we left off on Friday.  Friday proved to be a good day for Colorado Home Mortgage Loan rates, which showed most of its improvements on this morning rate sheets.  We do not have a lot of activity being released on the economic data side.  Our next big report will come in on April 24th, when Durable goods release its current numbers.  Today Colorado Home Mortgage Loan rates will certainly be impacted by volume and Headlines.  I discussed several of the headline topics at www.coloradomortgagebanking.com/news.  For now I will focus on the volume component.  Obviously when volume is down and supply is high investors will lower their price on Mortgage Backed Securities in order to stimulate buying.  Right now the market has seen mixed approaches and Colorado Home Mortgage Loan rates have seen some movement in both directions.  We expect that rates will continue this hourly up and down swing, but ultimately over the long term will see rates drop.  If Durable Goods come in lower the expected we should see some nice improvements through the end of the month.  Right now we are maintaining our FLOAT recommendation until something in the market sparks a must lock situation.  We need to keep a close eye on Oil.  Oil continues to be the commodity that can make or break the direction the market goes.  So far Oil companies have done very little to help the overall state of the economy.  This is evident in the astonishing profit growth each of these companies have had in the last 4 quarters.  Colorado Home Mortgage Loan rates will be impacted by the level of profitability made by these companies.  The cost of oil impacts the cost of production which in return impacts the cost to the consumer.  In short when oil goes up inflation tends to be on the rise.  When inflation creeps its ugly face into the Mortgage Backed Securities markets, investors begin to see their investments devalued and in return must offer a higher Colorado Home Mortgage Loan rate to compensate the difference.  If it were not for Oil prices we would probably be seeing some of the lowest Colorado home Mortgage Loan rates ever recorded.  Oil by itself does not move the market, but it does have an impact.  With that said everything else in the market signals better Colorado Home Mortgage Loan rates to come.  Keep watch and remember call me with any questions.

We had three economic reports come out today all of which appears to be good news for Mortgage Backed Securities.  The main thing to monitor will be volume.  If Volume is low then Colorado Home Mortgage Loan rates will increase until something stimulated activity in the market.  So far today that has been the case and Colorado Home Mortgage Loan rates are beginning to increase slightly.  This can also be a direct reflection on the volume created in the stock market over the last couple of days.  This trend will likely stop and Colorado Home Mortgage Loan rates are expected to recover next week.  Each of the reports today indicated that we are still in a bit of a mess as it relates to our economy.  Each report reminded us that we are not out of the woods and we still have work to do before recovery is recognized.  Jobless Claims came in as expected and showed that we are still extremely high.  Colorado Home Mortgage Loan rates should have responded well to the news and rates should come down a bit.  The four-week moving average and continuing claims are watched more closely for changes. The labor market is considered to be improving when the four-week moving average goes below 400,000. If unemployment goes low enough it can put wage pressure on the economy and can cause increases in interest rates.

Leading indicator report came out as expected today.  The Leading Indicators report is composed of ten indicators designed to forecast the strength of the economy six to nine months into the future. The ten indicators are picked from different parts of the economy and are chosen because of their relevancy and accuracy. They are each given equal weight when applied to the composite index.  This report basically give you the state of the economy and can show whether we are moving forward as a whole.  Colorado Home Mortgage Loan rates don’t typically move with this indicator, but it does give us some idea whether we are in a recovery state or not.

Finally the Philadelphia Fed Index is used to get a sense of the Manufacturing component which accounts for about 20% of our market.  The Philadelphia Fed Index is considered to be a good indicator of changes in everything from employment, general prices, and conditions within the manufacturing industry. Manufacturing is considered to be a precursor to future economic conditions and it lays the groundwork toward economic recovery. For example, in a poor economy if manufacturing starts to pick up there is an expectation that the economy will soon follow behind.  In short the reports don’t lie the economy still needs help in a bad way, and normally when the economy suffers Colorado Home Mortgage Loan rates show improvements. 

Mortgage Backed Securities are showing some loss right now.  It has been an up and down day for Colorado Mortgage rates and so far we are looking less favorable then what was being reported an hour ago.  If the trend continues we may actually see pricing get a little worse today.  The Consumer Price index came in today right in line with expectations.  This in it self should have brought rates back in line, and we should instead, be experiencing some Colorado Mortgage Rate improvements.  The only rhyme or reason I can see causing change in the Mortgage Backed Securities, has to do with the Bullish approach investors are currently using in the stock market.  Some Corporate Profits are coming in as expected and investors are seeing that as a good sign.  What they forget is that though the profits are coming in as expect they are still coming in as CRAP:-)  Investors are like lemmings and I have said this many times.  One set of investors take a strong buy approach and the rest follow close behind, all of them thinking that someone knows something the other does not.  As soon as they realize that they are all dumb as posts, a rebound should be felt back in the securities market.  Colorado Mortgage rates should be seeing improvements right now, but so far that is not the case.  I believe that the improvements should be felt by the end of the week.  We continue to have economic reports through out the week and the second any of these reports remind us of where we are at as an economy, Colorado Mortgage rates should move back down.  FLOATING remains the recommendation in place.  We will keep a close eye on the Jobless claims report due out tomorrow.  This report by itself can bring things back into prospective.  Check out www.coloradomortgagebanking.com/news when you have a chance.

Daniel