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Why the Yield Curve is Suddenly the Center of Attention

Yield Curve

Media commentary on the yield curve has spiked in recent weeks.

So, why all the chatter and why does it matter?

Everything Says Up, But Rates Go Down

 04.16.18

The yield on the 10-year U.S. Treasury note drifted lower. The yield hovers around 2.8%. Mortgage rates dipped to their lowest level in two months. This all occurred last week. 

It shouldn’t have occurred. The headline news points to Treasury yields and mortgage rates moving to higher ground. 

The Calm Could Soon End

 Construction

It has been nice over the past couple weeks. 

Mortgage rates have drifted lower, even if they remain range-bound. The 4.5%-to-4.625% range on the prime 30-year fixed-rate loan still holds, as it has held for the past couple months. The good news is that quotes have held mostly at the low-end of the range. 

Your New Weapon to Win Bidding Wars: The Escalation Clause

Bidding War

By many estimations, bidding wars have become much more common in many segments of the U.S. housing market. In recent years, relatively high demand amid low housing supply has pushed up the price of homes throughout the country. This trend, coupled with the population density and heightened competition within many urban areas, creates the perfect storm for a bidding war. However, with a combination of luck and negotiating skill, it is possible to emerge victorious from a bidding war.

Investors Lose Their Appetite: How Mortgage Rates Benefitted

 Investor

The headline news appears bullish enough: Gross Domestic Product (GDP) was revised 40-basis- points higher to 2.9% for the fourth quarter. Most of what you would want up – consumer spending on durables and nondurables, nonresidential investment, and residential investment – was up.

Jumbo vs. Conforming Loans: What to Know and How to Choose

House

If you're on the hunt for your first mortgage, the whirlwind of terms can seem overwhelming. Between interest rates, APY, PMI and FHA, there are plenty of acronyms, figures and agencies to keep straight. Another set of terms that you might start reading or hearing a lot: jumbo loans, conforming loans and nonconforming loans. At first glance, these might sound like the most boring jargon of them all, but understanding jumbo and conforming loans helps make sense of the entire mortgage process.

Mortgage Rates React to the Expected

 Mortgage

Federal Reserve officials came and left on Wednesday.

They came with an interest rate increase. They increased the range on the federal funds rate 25 basis points. The new range is now 1.5%-to-1.75%. (Bloomberg shows a quote of 1.67%.) 

Mortgage Rates Hold Firm, Defy Outsized Payroll Gains

 Rates Steady

February was a blowout month for jobs. Payrolls rose by 313,000, double most economists’ estimates. The unemployment rate held at 4.1% thanks to an increase in formerly discouraged workers (not counted as unemployed in the official numbers) seeking jobs.

More Affordable Than We Think?

 Home Owner

The relentless march higher continues. Home prices continue to post at higher levels, as they have for the past five years. Realtor.com, Case-Shiller, and Trulia data show home prices relentlessly rising across the country month after month. 

Meet the New Boss, Sorta Like the Old Boss

News

We have a new Federal Reserve Chairman. Jerome Powell leads the troops these days. As Fed Chairman, Powell will recurrently be run through the Congressional wringer. His first run through occurred last week.