🎄 Markets close early Tuesday and reopen Thursday. Happy holidays! 🎄
Rates
Rates are up after last week’s Fed meeting:
Important notes for understanding and using this information:
- Any site/chart that advertises rates (like the above) is showing a national average for one very specific loan scenario, as reported by survey respondents. These aren’t the rates that borrowers are locking in. Use this only as a tool to get a gauge of what ballpark to expect
- 30 Yr Fixed Conventional: a “top tier” scenario is used as a baseline (owner occupied, single family, 25% down, 780+ credit)
- Most important point: the best use of this index is to track the CHANGE from week to week. There are so many things that can cause discrepancies between borrowers, lenders, and quotes.
Commentary
Last week wasn’t as bad as it could have been. Wednesday’s Fed meeting caused a bond sell-off, raising rates. But, after Friday’s PCE inflation report, things improved a bit. Bonds didn’t recover to the pre-Wednesday levels, but every little bit helps in terms of mortgage rates. PCE inflation came in at 0.1% at the core level, month over month. If inflation repeated that performance for 12 months, annual inflation would be below the 2.0% target.
Holiday weeks–particularly those for Thanksgiving and X-mas–tend to have idiosyncrasies. At the simplest level, this just means that we shouldn’t read too much into any seemingly counterintuitive volatility. Bonds can go either direction for what seems like no real reason.
Lock/Float Considerations
All bets are off until further notice following the Fed day rout. Any meaningful improvement in rates will require downbeat economic data and softer inflation. At this point in the year, we’re waiting until early January for the next major shoes to drop (NFP and CPI, specifically).
Econ Calendar – Potential Market Movers
- Thursday – Unemployment Claims, weekly
Loan Program Updates
Soft credit pulls for pre-approvals starting Jan 2!
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- Trended SoftQual credit reporting, designed to enhance loan file preparation while protecting borrowers from trigger leads. This streamlined process empowers borrowers with additional time to opt out of trigger leads, ensuring a smoother and more secure journey through the loan process.