Mortgage Rate Update for April 16, 2010

Terms: (A+ paper)
Purchase money, Owner Occupied, 60 day rate lock, Full Doc.

ALL RATES ASSUME 1 POINT

JUMBO
30 yr Fixed                                          5.375%             (unchanged)
5/1 ARM                                               4.875%             (up 1/8)
7/1 ARM                                               5.000%             (up 1/8)
10/1 ARM                                             5.250%             (up 1/8)

CONFORMING (up to $417,000)
30 yr Fixed                                          5.000%            (down 1/8)
15 yr Fixed                                           4.250%            (down 1/8)
5/1 ARM                                                3.625%            (down 1/8)
10/1 ARM                                             4.375%            (down 1/8)

CONFORMING + LOANS (417,001 – $729,750)
Purchase and no cash out, use conforming rates add up to 1/2 point fee at closing depending on scenario.
These price adjusters are subject to change

Prime Rate = 3.250%                                                    (unchanged)

APR: 30 yr = 5.27%, 15yr = 4.66%, 5/1 = 4.44%,  10/1 = 4.99%

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:: Market Update ::

Interesting news hitting the wire today is that the SEC is going to charge Goldman Sachs with Fraud stemming from their work with subprime mortgages.

Though not necessarily a market mover, this should be an interesting story to follow.

In housing news, housing starts are up to an annual rate of 626,000 which is the highest level since November 2008. This is also up 20% from a year ago.

Building permits, which tend to precede housing starts, are also up so look for these strong numbers to continue.

In Fed news, Kansas City Fed President Thomas Hoenig spoke about the need for the Fed to reduce its balance sheet. Specifically, he is calling for the Fed to unwind its recent mega-purchase program of mortgage backed securities. According to Hoenig, the Fed needs to start selling “as deliberately as possible”. If/when this starts to happen, we can consider this an early stage warning that rates are also about to go up.

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Have a great Weekend!

Dan Spitz
Private Mortgage Banker
Wells Fargo Home Mortgage

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