Robert Half 2012 Salary Guide

Reminiscent of the days when needles skipped backwards and replayed a line from a song over and over, mortgage rates set a new record low again last week. Economic news was similar to what we have been seeing for some time, highlighting the fragile, extremely-slow, but still growing economy.   

So, can mortgage rates go even lower in coming weeks?  The answer is absolutely maybe. While few analysts believed we could continue to see such low mortgage rates, anything, including even lower mortgage rates is possible.  This coming week could set the tone for rates for the next few weeks with the Fed meeting for two days to discuss monetary policy. Most analysts are expecting a significant announcement to come from the Fed. Some of the programs that experts are predicting the Fed may launch, such as changing the mix of investments the Fed holds, could push long and short-term rates in opposite directions. In any event, mortgage rates are likely to stay at low levels for the foreseeable future with occasional flares upward on good economic news. 

The summer ended last week with mortgage rates remaining at unbelievably low levels. While the terrible loss of life and wide-spread destruction of Hurricane Irene was tragic, the storm was less destructive than it could have been. Economic news again highlighted the tepid state of the economy. The ISM Manufacturing Index slid downward to 50.6, indicating that manufacturing is continuing to grow, albeit extremely slowly. The week ended with a disappointing employment report. The unemployment rate remained unchanged, but no new jobs were created last month.

Next week’s economic calendar is light in terms of important economic data. As such, other technical factors and events may influence rates. The biggest of these may be the President’s jobs speech on Thursday. If financial markets react positively to his congressional address, then we could see rates moving upward. However, even if Obama presents some great ideas, markets may doubt that politicians can set aside their differences to get anything done, and rates would remain steady.

Mortgage rates moved slightly upward last week, after another week with significant volatility. Concerns over the Obama administration’s new focus on new or re-tooled refinancing likely helped nudge rates upward, along with some money flowing out of the relative safety of various US bonds. The US Fed’s annual retreat in Wyoming left the financial community with little specifics on what the Fed might do, but Fed Chair Bernanke properly pointed out that much of what needs to be done to stimulate the economy lies outside the Fed, and with policy makers in Washington and Europe.

This week could be another volatile week for mortgage rates with significant economic data due, never-ending politics, and the aftermath of Irene. We could easily see mortgage rates nudge back downward if the ISM Manufacturing Index slips below 50, indicating manufacturing is beginning to contract. However, if Irene’s impact is seen as manageable, and Friday’s unemployment report reveals some unexpected strength in the labor market, rates might move upward as the week ends.

 

 

 

 

 

Mortgage rates dropped to new lows again last week as fears of a global economic slowdown grew. Financial markets around the world were once again beaten down as traders shifted money around, in many cases moving it into vehicles that provided little to no yield, but provided a measure of perceived security. Even with the recent downgrade of US debt, US Treasuries continue to be seen as the safest place. However, US economic news was not as bleak as one might assume. Industrial Production rose by 0.9%, Housing Starts remained level, and the LEI grew 0.5%. We’ve even had inflationary pressures slightly increasing, which is often seen as a byproduct of economic output. So, are we heading into another recession? Many analysts believe we are not, but if enough of the global financial market panics and behaves as if we are, it may become a self-fulfilling prophecy.

This week could be another choppy week for financial markets. While it seems that rates couldn’t fall any lower, bad news could make further decreases a reality.

 

 

 

 

 

 

 

 

Pricing is affected primarily by the interrelationship of capital, risk analytics, the secondary market price, cost and revenues associated with origination and fulfillment and the value of any component retained by the corporation (this is primarily the customer and servicing value).

The difference between interest rate and APR:

• The interest rate incorporates one measure: the cost of borrowing money expressed as a percentage.
• The APR incorporates more than one measure. It includes the interest rate plus other finance charges (such as origination fee and discount points). Because all lenders must follow the same rules to calculate the APR, it is a good way for applicants to compare loan options among lenders.

Points are a one-time fee paid to the bank to improve a customer’s rate of interest for the life of the loan or to reduce the margin for an ARM loan. One point is 1% of the loan amount. Borrowers can offer to pay lender points as a method of reducing the interest rate on the loan, thus obtaining a lower monthly payment in exchange for this upfront payment.

An origination fee is a lender’s fee charged to the borrower for processing a loan application and is expressed as a percentage of the mortgage amount. This fee covers the costs of issuing the loan.

Last week was a truly chaotic week for financial markets.With the S&P downgrade of US debt to start the week, traders, analysts, and everyone involved in the financial world prepared themselves for a wild week. The US Federal Reserve released its policy announcement, promising to keep rates low for the next two years. In Europe, concerns exploded that Spain and Italy would soon be in financial crises, and as the week ended, France was added to the list. Stock markets around the world bucked up and down, and by the end of the week, one thing was fairly clear. Downgraded US Treasuries are still seen as one of the safest, most-secure places to park your cash in times of trouble.

Mortgage rates ended the week lower again, with concerns that the US economy remains weak. While there are many things around the globe that could influence US mortgage rates again, we may see the US economy as the primary source guiding interest rates. If we see signs that the economy is improving, rates are likely to move upward, but signs of weakness may push rates further downward.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unless you’ve been hiding in a cave, you’ve probably seen the tumultuous financial news over the last week. While the world watched, the US government extended its borrowing authority, and there was a collective sigh. Before everyone caught their breath, the US stock markets went into a freefall. Global money managers poured cash into US Treasuries, driving mortgage rates downward in a hurry. Then the Labor Dept. announced a greater-than-expected increase in jobs, and markets began to recover, with rates moving back upward quickly. Financial markets closed on Friday, but the financial news continued to flow, with S&P downgrading the US debt for the first time in history.

Opinions are extremely varied as to what will happen with interest rates and in financial markets this week. The truth is that we don’t know. We are in new territory in the financial world. The Fed meets this week, and the world will be scrutinizing its policy announcement. Mortgage rates could easily go either way this week, with the potential for big swings in any direction.