9/16/16

September 16th, 2016

What Is Going On With Interest Rates?  #wigowir

When the price of Mortgage Backed Securities (MBS) on the Chart above goes down rates go up, and when the price goes up rates come down. . All times are Eastern Standard. 

A slight improvement over the last 4 days.  Not a whole lot of movement in the MBS market for most of the session, aside from some early morning volatility. The hotter-than-expected August CPI data held prices near the flatline today. The 3% Fannie Mae 30-yr coupon closed at 103.50, +9bp. The Red line is the 100 day moving average that appears to be a buy signal to traders at this time.

Other news

Stocks ended lower after the Deutsche Bank debacle, which pulled U.S. bank shares lower and spread to the broader market. The Dow lost 88.68 points to 18,123.80, the S&P lost 8.10 points to 2,139.16 while the tech heavy Nasdaq fell by 5.11 points to end at 5,244.56. WTI oil was last seen at $43.20/barrel, -$0.71. 10-yr T Note yield 1.68%. Next week's economic calendar highlights the housing sector but will take a backseat to the 2-day Fed meeting which kicks off on Tuesday and will end Wednesday with the 2:00 p.m. ET release of the Fed statement. Fed Chair Yellen will have a press conference at at 2:30 after the statement is released. Have a great weekend!

9:38 AM New Rates have been posted

30-Year Fixed 3.500% (3.583% APR) No Origination Fee  

15-Year Fixed 2.750%   (2.892% APR) No Origination Fee

7-1 ARM 30 year 3.000% (3.341% APR) No Origination Fee

 

Feel free to call (205-266-5669) or email (jmarbury@nationalbankofcommerce.com) John for a quote based on the terms of you loan.

For more rates and details click: http://www.johnmarbury.com/page5.html/

  • 30-Year Fixed-Rate Mortgage: The monthly payment on a $200,000 30-year Fixed-Rate Loan at 3.500% and 70% loan-to-value (LTV) is $898.09 with 0 points due at closing. The Annual Percentage Rate (APR) is 3.457%. Payment does not include taxes and insurance premiums. The actual payment amount will be greater. Some state and county maximum loan amount restrictions may apply.
  •  15-Year Fixed-Rate Mortgage: The monthly payment on a $200,000 15-year Fixed-Rate Loan at 2.750% and 70% loan-to-value (LTV) is $1357.24 with 0 points due at closing. The Annual Percentage Rate (APR) is 2.892%. Payment does not include taxes and insurance premiums. The actual payment amount will be greater. Some state and county maximum loan amount restrictions may apply.
  • 7-1 30 year ARM for $200,000 with an Initial Interest Rate of 3.000% (3.334% APR) your monthly payments for years 1 – 7 would be $870.41 and for years 8 -30 monthly payments would be $886.87 (based on the current Index  of  1.210% Plus Margin of 2.25% to $417,000 and 2.5% to $900,000).  Monthly payments do not include taxes and insurance and the actual payment obligation will be greater.  Your variable interest rate is subject to a floor of your Initial Interest Rate.  Your variable interest rate can increase or decrease after the seventh year by 2 percentage points annually and can increase 4 percentage points over your Initial Interest Rate over the term of your loan.  The index for this loan program is the average of the interbank Offered Rates for One Year Denominated Deposits in the London Market (LIBOR)

Below is the news when it happened and the market’s reaction.  All Times are Eastern Standard Time. 

2:49 PM - MBS slowly edge higher as the quiet afternoon session continues.

1:35 PM - MBS holding firm, quiet trade eyed into the close.

12:05 PM - MBS trade in a tight range near unchanged.

10:37 AM - September Consumer Sentiment edges 89.8, below the 91.5 expected.

10:28 AM - MBS now at session lows.

9:32 AM - Stocks open lower, Dow -100 points.

8:35 AM - The hotter than expected CPI knocks MBS off their highs.

August CPI 0.2% vs the 0.1% expected. Core CPI 0.3% vs 0.2% expected.

Year-over-year Core CPI 2.3%, CPI 1.1%.

8:27 AM - Stock futures also being weighed down by lower oil prices. WTI $43.18/barrel, -$0.73.

S&P futures lower in sympathy with lower shares across pond.

The claims against Deutsche Bank come for the years between 2005 and 2007.

European Stocks decline after Deutsche Bank was threatened with a $14B fine over sales of mortgage backed securities. The bank said it has no intention to settle the potential civil claims anywhere near that figure.

MBS open modestly higher ahead of August CPI, which is set to be released at 8:30. Consumer Sentiment at 10.

 

Contact

John Marbury
jmarbury@nationalbankofcommerce.com
NMLS# 740833
Phone:205-266-5669
Fax: 866-217-4174

813 Shades Creek Parkway
Birmingham, Alabama 35209
 

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As a loan officer (mortgage broker 1989-2006) since 1985, I have seen a lot of changes over the years. The only consistency in the mortgage business and life is change. This is the reason that we believe it is necessary to move quickly and to be early. Let us know if you have any questions or if we can help in any way.

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