What You Need To Know About Mortgage Rates Today

    What You Need To Know About Mortgage Rates Today

    Jun 11, 2020

    The “new normal” caused by the Coronavirus Pandemic has affected our lives in serious ways and has contributed to economic distress throughout the U.S. and the world. 

    Fear not!

    There are positives to focus on, especially in the housing market. 

    Our knowledgeable lender partner, Doc Spaulding at Golden Empire Mortgage, Inc., has passed along his insights! 

    See what he has to say about mortgage rates:

    This past week, home loan rates ticked a bit higher from their best levels in U.S. history. More importantly, this increase in rates may be the start of a trend in higher rates.

    Here’s four reasons why rates rose and why they may continue to do so:

    #1 Economic Optimism

    More and more states are reopening, and people are getting back to work. Friday’s Jobs Report showed 2.5 million jobs were created, when 8 million jobs were expected to be lost. The unemployment rate rose to over 13%, but expectations were for a much worse 20% unemployment rate. Bonds and rates don’t like good news, and this was good news.

    #2 Overwhelming Policy Response

    The Fed and U.S. Treasury’s response to help the economy get through the coronavirus impact is by far the largest monetary stimulus in the history of the country. This is more positive news which has helped Stocks trade to their best levels since March 4. As Stocks move higher, many times rates do as well. We saw that this week.

    #3 Coronavirus Uncertainty Abating

    Hope and optimism are rising now that we are well beyond the worst of the coronavirus. If states continue to see unemployment and new cases go down, the optimism will be justified and better times will be ahead. Stocks and rates increase during better days.

    #4 Global Yields are Increasing

    In Germany, their 10-year Bund yield has moved from -.60% to -.27% as of this weekend. This is for the same three previous reasons. If yields in Germany continue to move higher from negative territory, U.S. rates, including home loan rates, will continue to tick higher as well.

    The Good News

    Any uptick in rates in the near-term may be limited for two reasons. The Fed continues to purchase Bonds on a daily basis, thereby holding yields down, and economies are reopening slowly, so rates should increase slowly over time as well.

    Bottom Line

    With rates at all-time lows, if you can secure a home loan to either refinance or purchase a home, now is a great time.

    Doc Spaulding

    Senior Loan Originator

    858-750-9110 Direct/Text

    NMLS#657535

    Golden Empire Mortgage, Inc. - NMLS#2427

    22342 Avenida Empresa, Suite 150

    Rancho Santa Margarita, Ca 92688

    dspaulding@gemcorp.com 

    Want to learn more?

    Give us a call! (949) 291-2851

    Shoot us an email! tomkaren.roberts@gmail.com