- This topic has 95 replies, 10 voices, and was last updated 14 years, 11 months ago by
gdcox.
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AuthorPosts
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January 23, 2008 at 1:37 AM #11603
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January 23, 2008 at 10:15 AM #141191
cashflow
ParticipantHi SD R,
I’m watching this closely as well as we want to refi our rental home. I noticed on Bankrate that usually I would get up to 10 different quotes, now I’m only seeing about 5 come up for this area….do you think this is due to the credit crunch, just not as many willing to finance in this region?? Mortgage Capital Assoc. usually had lower rates and quote a reasonable fee, they are at 5.1% today…not too bad…
What are your thoughts on how low this could go? I’m excited to get this done though and long term have a great rate and save some $$$. On the flipside, we too had a CD resetting, but it locked in beggining of month, still not too good though.
Can’t have it all!
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January 23, 2008 at 11:29 AM #141251
SD Realtor
ParticipantGuys –
HLS or Pasadena broker and mortgage professionals have more expert takes then I do. With that said long term mortgages have ALWAYS trended in the same direction of the 10/30 year treasury yields. The risk premium that is built in by the originators will fluctuate based on many factors but mostly on the secondary market. When we saw the secondary market lockup in August, that risk premium jumped way up. However memories are short and it went down after several weeks. Obviously the risk premium for a conforming loan that is FHA approved is the lowest. The premiums go up with jumbos, etc…
Now how low will rates go? Don’t know and don’t have a clue. Will they TREND in the same direction as the long term treasury yield? Absolutely. Will the risk premiums vary? Absolutely.
Your mission then is to find the best time, that is when the 10 or 30 year treasury yield is low AND the risk premium is low. Since you do not have much knowledge of the risk premium all you can do is monitor the 10 year.
Of course there is continuing bad news about foreclosures but for people to think mortgage rates will not budge while the 10 year yield plummets is not realistic.
Finally, long term rates do not just move lock step with the 10 year. As any shmuck in life knows, you get screwed on the way down and double screwed on the way up. In other words, lenders are sticky on the way down and they will not lower rates immediately even though the 10 year may go down. They may wait a day or a few days to make sure it doesnt spike back up, then they will lower them. Also many times one will not lower a rate until the other does, then they all do at once. Of course the SECOND the yield moves back up they all raise rates up immediately.
SD Realtor
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January 23, 2008 at 11:53 AM #141266
kicksavedave
ParticipantGreat thread and very timely info for me. I’m 60 days from closing on the new home near Denver. The builders lender has offered a 95% loan for 5.65% with the PMI built in and they will pay all the closing cost. They want me to lock that in but I see little to no upside in doing that right now, only downside with the 10 and 30 T’s yields plummeting. I’m going to let it ride in hopes that another 1/4 point or more drop in the next 60 days materializes.
Am I being greedy, or smart?
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January 23, 2008 at 12:14 PM #141271
SD Realtor
ParticipantTough call man…greedy or smart… usually they do not go hand in hand…let’s just say you are trying to get the best rate possible and leave it at that.
Like I said, I am not expert on the bond market. That is where guys like Chris S and the experts come in. All I can tell you is to keep checking that 10 year treasury yield every day or more…
Sometimes the lenders have a 1 time rate adjustment but I take it the program you are looking at does not have that eh? That allows you to lock in BUT you also get a 1 time chance to relock during the escrow period.
SD Realtor
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January 23, 2008 at 12:42 PM #141287
Eugene
ParticipantThe $64,000 question: how far can US 10-year treasury go when you can buy 10-year French Euro-denominated bonds yielding 4.5%?
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January 23, 2008 at 12:57 PM #141291
SD Realtor
ParticipantThat is the problem esmith. Common sense would dictate that the 10 year would not go down more because of your statement and other rationale. However common sense would have also dictated that in order to get our own financial mess in order we should have seen higher interest rates many years ago. How do we know that the there is not any behind the scenes nudging of purchasers both foreign and domestic of US debt.
If you try to out think the market generally you lose. I am not saying you are incorrect. I am just trying to say that long long ago I gave up trying to apply my simplistic rational analysis. The marketplace is not controlled by common sense and visibility. Unfortunately I believe it is much more controlled by other forces of which I and the general public have little to no control over. So all I can do is watch it, try to make money off of it and get the best deal I can off of it.
As I say there are many many who are well versed in the bond market and bond trading. You very well may be quite correct in your analysis. My stance is a bit more cautious which is, I have no clue where the bottom is, but someday it damn well has to go up… and farther into the future way up.
SD Realtor
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January 23, 2008 at 1:11 PM #141296
ucodegen
ParticipantIf you try to out think the market generally you lose. I am not saying you are incorrect. I am just trying to say that long long ago I gave up trying to apply my simplistic rational analysis. The marketplace is not controlled by common sense and visibility.
Common sense and visibility no, but it is predictable over the long term (ie. what we knew would happen for housing’s rapid price run-up). Over the short term, all bets are off. It is all manipulation and emotion.
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January 23, 2008 at 1:31 PM #141316
SD Realtor
ParticipantWell said uco, I agree.
SD Realtor
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April 16, 2008 at 11:11 AM #188323
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April 16, 2008 at 12:00 PM #188353
donaldduckmoore
ParticipantCan I refi a house that I purchased a month or 2 ago? The contract does not have prepayment penalty though. Thanks.
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April 16, 2008 at 12:08 PM #188368
vizcaya
ParticipantYeah, I purchased back when rates were 6.5 for a 30yr fixed, then a couple months later I locked in to a 5.375 30yr fixed.
There is some calculators out there that can help you decide if it is worth refi’ing
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April 16, 2008 at 1:36 PM #188453
donaldduckmoore
ParticipantI remember a few years back when I did my refi, it was no point no fee refi. Are they still available now?
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April 16, 2008 at 9:29 PM #188753
NotCranky
ParticipantHey SDR I thought I’d bump this up a couple of times to see if you catch it. Should be a little fun for you as this ten year is your baby and you called this low. It didn’t/hasn’t quite hit the 2003 low but it got pretty close. I locked on my building money on Tuesday and have been calling former clients to give them a heads up on refinancing opportunities.
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April 16, 2008 at 9:43 PM #188759
SD Realtor
ParticipantRus you did good man. To be honest I am really surprised that the bond market has remained so strong. If you look at the past few weeks we have been really stuck in a pretty narrow trading range. It tried to break out to the up side a few weeks ago as people were selling off a little bit… it crawled up to like 3.9 but then as more sh-t hit the fan people ran for cover again. Good for you for locking into the low rate!
SD Realtor
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April 16, 2008 at 9:46 PM #188773
NotCranky
ParticipantA lot of thanks goes to you for just getting me to focus on this more. I am calling a bottom now for the next decade!
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April 16, 2008 at 9:46 PM #188795
NotCranky
ParticipantA lot of thanks goes to you for just getting me to focus on this more. I am calling a bottom now for the next decade!
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April 16, 2008 at 9:46 PM #188826
NotCranky
ParticipantA lot of thanks goes to you for just getting me to focus on this more. I am calling a bottom now for the next decade!
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April 16, 2008 at 9:46 PM #188835
NotCranky
ParticipantA lot of thanks goes to you for just getting me to focus on this more. I am calling a bottom now for the next decade!
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April 16, 2008 at 9:46 PM #188839
NotCranky
ParticipantA lot of thanks goes to you for just getting me to focus on this more. I am calling a bottom now for the next decade!
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April 16, 2008 at 9:43 PM #188781
SD Realtor
ParticipantRus you did good man. To be honest I am really surprised that the bond market has remained so strong. If you look at the past few weeks we have been really stuck in a pretty narrow trading range. It tried to break out to the up side a few weeks ago as people were selling off a little bit… it crawled up to like 3.9 but then as more sh-t hit the fan people ran for cover again. Good for you for locking into the low rate!
SD Realtor
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April 16, 2008 at 9:43 PM #188812
SD Realtor
ParticipantRus you did good man. To be honest I am really surprised that the bond market has remained so strong. If you look at the past few weeks we have been really stuck in a pretty narrow trading range. It tried to break out to the up side a few weeks ago as people were selling off a little bit… it crawled up to like 3.9 but then as more sh-t hit the fan people ran for cover again. Good for you for locking into the low rate!
SD Realtor
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April 16, 2008 at 9:43 PM #188821
SD Realtor
ParticipantRus you did good man. To be honest I am really surprised that the bond market has remained so strong. If you look at the past few weeks we have been really stuck in a pretty narrow trading range. It tried to break out to the up side a few weeks ago as people were selling off a little bit… it crawled up to like 3.9 but then as more sh-t hit the fan people ran for cover again. Good for you for locking into the low rate!
SD Realtor
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April 16, 2008 at 9:43 PM #188825
SD Realtor
ParticipantRus you did good man. To be honest I am really surprised that the bond market has remained so strong. If you look at the past few weeks we have been really stuck in a pretty narrow trading range. It tried to break out to the up side a few weeks ago as people were selling off a little bit… it crawled up to like 3.9 but then as more sh-t hit the fan people ran for cover again. Good for you for locking into the low rate!
SD Realtor
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April 16, 2008 at 9:29 PM #188775
NotCranky
ParticipantHey SDR I thought I’d bump this up a couple of times to see if you catch it. Should be a little fun for you as this ten year is your baby and you called this low. It didn’t/hasn’t quite hit the 2003 low but it got pretty close. I locked on my building money on Tuesday and have been calling former clients to give them a heads up on refinancing opportunities.
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April 16, 2008 at 9:29 PM #188807
NotCranky
ParticipantHey SDR I thought I’d bump this up a couple of times to see if you catch it. Should be a little fun for you as this ten year is your baby and you called this low. It didn’t/hasn’t quite hit the 2003 low but it got pretty close. I locked on my building money on Tuesday and have been calling former clients to give them a heads up on refinancing opportunities.
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April 16, 2008 at 9:29 PM #188816
NotCranky
ParticipantHey SDR I thought I’d bump this up a couple of times to see if you catch it. Should be a little fun for you as this ten year is your baby and you called this low. It didn’t/hasn’t quite hit the 2003 low but it got pretty close. I locked on my building money on Tuesday and have been calling former clients to give them a heads up on refinancing opportunities.
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April 16, 2008 at 9:29 PM #188820
NotCranky
ParticipantHey SDR I thought I’d bump this up a couple of times to see if you catch it. Should be a little fun for you as this ten year is your baby and you called this low. It didn’t/hasn’t quite hit the 2003 low but it got pretty close. I locked on my building money on Tuesday and have been calling former clients to give them a heads up on refinancing opportunities.
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April 16, 2008 at 1:36 PM #188473
donaldduckmoore
ParticipantI remember a few years back when I did my refi, it was no point no fee refi. Are they still available now?
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April 16, 2008 at 1:36 PM #188507
donaldduckmoore
ParticipantI remember a few years back when I did my refi, it was no point no fee refi. Are they still available now?
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April 16, 2008 at 1:36 PM #188517
donaldduckmoore
ParticipantI remember a few years back when I did my refi, it was no point no fee refi. Are they still available now?
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April 16, 2008 at 1:36 PM #188521
donaldduckmoore
ParticipantI remember a few years back when I did my refi, it was no point no fee refi. Are they still available now?
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April 16, 2008 at 12:08 PM #188390
vizcaya
ParticipantYeah, I purchased back when rates were 6.5 for a 30yr fixed, then a couple months later I locked in to a 5.375 30yr fixed.
There is some calculators out there that can help you decide if it is worth refi’ing
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April 16, 2008 at 12:08 PM #188419
vizcaya
ParticipantYeah, I purchased back when rates were 6.5 for a 30yr fixed, then a couple months later I locked in to a 5.375 30yr fixed.
There is some calculators out there that can help you decide if it is worth refi’ing
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April 16, 2008 at 12:08 PM #188428
vizcaya
ParticipantYeah, I purchased back when rates were 6.5 for a 30yr fixed, then a couple months later I locked in to a 5.375 30yr fixed.
There is some calculators out there that can help you decide if it is worth refi’ing
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April 16, 2008 at 12:08 PM #188435
vizcaya
ParticipantYeah, I purchased back when rates were 6.5 for a 30yr fixed, then a couple months later I locked in to a 5.375 30yr fixed.
There is some calculators out there that can help you decide if it is worth refi’ing
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April 16, 2008 at 12:00 PM #188375
donaldduckmoore
ParticipantCan I refi a house that I purchased a month or 2 ago? The contract does not have prepayment penalty though. Thanks.
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April 16, 2008 at 12:00 PM #188403
donaldduckmoore
ParticipantCan I refi a house that I purchased a month or 2 ago? The contract does not have prepayment penalty though. Thanks.
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April 16, 2008 at 12:00 PM #188415
donaldduckmoore
ParticipantCan I refi a house that I purchased a month or 2 ago? The contract does not have prepayment penalty though. Thanks.
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April 16, 2008 at 12:00 PM #188420
donaldduckmoore
ParticipantCan I refi a house that I purchased a month or 2 ago? The contract does not have prepayment penalty though. Thanks.
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April 16, 2008 at 11:11 AM #188343
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April 16, 2008 at 11:11 AM #188373
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April 16, 2008 at 11:11 AM #188384
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April 16, 2008 at 11:11 AM #188388
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January 23, 2008 at 1:31 PM #141543
SD Realtor
ParticipantWell said uco, I agree.
SD Realtor
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January 23, 2008 at 1:31 PM #141556
SD Realtor
ParticipantWell said uco, I agree.
SD Realtor
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January 23, 2008 at 1:31 PM #141584
SD Realtor
ParticipantWell said uco, I agree.
SD Realtor
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January 23, 2008 at 1:31 PM #141644
SD Realtor
ParticipantWell said uco, I agree.
SD Realtor
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January 23, 2008 at 1:11 PM #141524
ucodegen
ParticipantIf you try to out think the market generally you lose. I am not saying you are incorrect. I am just trying to say that long long ago I gave up trying to apply my simplistic rational analysis. The marketplace is not controlled by common sense and visibility.
Common sense and visibility no, but it is predictable over the long term (ie. what we knew would happen for housing’s rapid price run-up). Over the short term, all bets are off. It is all manipulation and emotion.
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January 23, 2008 at 1:11 PM #141537
ucodegen
ParticipantIf you try to out think the market generally you lose. I am not saying you are incorrect. I am just trying to say that long long ago I gave up trying to apply my simplistic rational analysis. The marketplace is not controlled by common sense and visibility.
Common sense and visibility no, but it is predictable over the long term (ie. what we knew would happen for housing’s rapid price run-up). Over the short term, all bets are off. It is all manipulation and emotion.
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January 23, 2008 at 1:11 PM #141563
ucodegen
ParticipantIf you try to out think the market generally you lose. I am not saying you are incorrect. I am just trying to say that long long ago I gave up trying to apply my simplistic rational analysis. The marketplace is not controlled by common sense and visibility.
Common sense and visibility no, but it is predictable over the long term (ie. what we knew would happen for housing’s rapid price run-up). Over the short term, all bets are off. It is all manipulation and emotion.
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January 23, 2008 at 1:11 PM #141624
ucodegen
ParticipantIf you try to out think the market generally you lose. I am not saying you are incorrect. I am just trying to say that long long ago I gave up trying to apply my simplistic rational analysis. The marketplace is not controlled by common sense and visibility.
Common sense and visibility no, but it is predictable over the long term (ie. what we knew would happen for housing’s rapid price run-up). Over the short term, all bets are off. It is all manipulation and emotion.
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January 23, 2008 at 12:57 PM #141519
SD Realtor
ParticipantThat is the problem esmith. Common sense would dictate that the 10 year would not go down more because of your statement and other rationale. However common sense would have also dictated that in order to get our own financial mess in order we should have seen higher interest rates many years ago. How do we know that the there is not any behind the scenes nudging of purchasers both foreign and domestic of US debt.
If you try to out think the market generally you lose. I am not saying you are incorrect. I am just trying to say that long long ago I gave up trying to apply my simplistic rational analysis. The marketplace is not controlled by common sense and visibility. Unfortunately I believe it is much more controlled by other forces of which I and the general public have little to no control over. So all I can do is watch it, try to make money off of it and get the best deal I can off of it.
As I say there are many many who are well versed in the bond market and bond trading. You very well may be quite correct in your analysis. My stance is a bit more cautious which is, I have no clue where the bottom is, but someday it damn well has to go up… and farther into the future way up.
SD Realtor
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January 23, 2008 at 12:57 PM #141531
SD Realtor
ParticipantThat is the problem esmith. Common sense would dictate that the 10 year would not go down more because of your statement and other rationale. However common sense would have also dictated that in order to get our own financial mess in order we should have seen higher interest rates many years ago. How do we know that the there is not any behind the scenes nudging of purchasers both foreign and domestic of US debt.
If you try to out think the market generally you lose. I am not saying you are incorrect. I am just trying to say that long long ago I gave up trying to apply my simplistic rational analysis. The marketplace is not controlled by common sense and visibility. Unfortunately I believe it is much more controlled by other forces of which I and the general public have little to no control over. So all I can do is watch it, try to make money off of it and get the best deal I can off of it.
As I say there are many many who are well versed in the bond market and bond trading. You very well may be quite correct in your analysis. My stance is a bit more cautious which is, I have no clue where the bottom is, but someday it damn well has to go up… and farther into the future way up.
SD Realtor
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January 23, 2008 at 12:57 PM #141558
SD Realtor
ParticipantThat is the problem esmith. Common sense would dictate that the 10 year would not go down more because of your statement and other rationale. However common sense would have also dictated that in order to get our own financial mess in order we should have seen higher interest rates many years ago. How do we know that the there is not any behind the scenes nudging of purchasers both foreign and domestic of US debt.
If you try to out think the market generally you lose. I am not saying you are incorrect. I am just trying to say that long long ago I gave up trying to apply my simplistic rational analysis. The marketplace is not controlled by common sense and visibility. Unfortunately I believe it is much more controlled by other forces of which I and the general public have little to no control over. So all I can do is watch it, try to make money off of it and get the best deal I can off of it.
As I say there are many many who are well versed in the bond market and bond trading. You very well may be quite correct in your analysis. My stance is a bit more cautious which is, I have no clue where the bottom is, but someday it damn well has to go up… and farther into the future way up.
SD Realtor
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January 23, 2008 at 12:57 PM #141619
SD Realtor
ParticipantThat is the problem esmith. Common sense would dictate that the 10 year would not go down more because of your statement and other rationale. However common sense would have also dictated that in order to get our own financial mess in order we should have seen higher interest rates many years ago. How do we know that the there is not any behind the scenes nudging of purchasers both foreign and domestic of US debt.
If you try to out think the market generally you lose. I am not saying you are incorrect. I am just trying to say that long long ago I gave up trying to apply my simplistic rational analysis. The marketplace is not controlled by common sense and visibility. Unfortunately I believe it is much more controlled by other forces of which I and the general public have little to no control over. So all I can do is watch it, try to make money off of it and get the best deal I can off of it.
As I say there are many many who are well versed in the bond market and bond trading. You very well may be quite correct in your analysis. My stance is a bit more cautious which is, I have no clue where the bottom is, but someday it damn well has to go up… and farther into the future way up.
SD Realtor
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January 23, 2008 at 12:42 PM #141514
Eugene
ParticipantThe $64,000 question: how far can US 10-year treasury go when you can buy 10-year French Euro-denominated bonds yielding 4.5%?
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January 23, 2008 at 12:42 PM #141526
Eugene
ParticipantThe $64,000 question: how far can US 10-year treasury go when you can buy 10-year French Euro-denominated bonds yielding 4.5%?
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January 23, 2008 at 12:42 PM #141553
Eugene
ParticipantThe $64,000 question: how far can US 10-year treasury go when you can buy 10-year French Euro-denominated bonds yielding 4.5%?
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January 23, 2008 at 12:42 PM #141614
Eugene
ParticipantThe $64,000 question: how far can US 10-year treasury go when you can buy 10-year French Euro-denominated bonds yielding 4.5%?
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January 23, 2008 at 12:14 PM #141499
SD Realtor
ParticipantTough call man…greedy or smart… usually they do not go hand in hand…let’s just say you are trying to get the best rate possible and leave it at that.
Like I said, I am not expert on the bond market. That is where guys like Chris S and the experts come in. All I can tell you is to keep checking that 10 year treasury yield every day or more…
Sometimes the lenders have a 1 time rate adjustment but I take it the program you are looking at does not have that eh? That allows you to lock in BUT you also get a 1 time chance to relock during the escrow period.
SD Realtor
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January 23, 2008 at 12:14 PM #141511
SD Realtor
ParticipantTough call man…greedy or smart… usually they do not go hand in hand…let’s just say you are trying to get the best rate possible and leave it at that.
Like I said, I am not expert on the bond market. That is where guys like Chris S and the experts come in. All I can tell you is to keep checking that 10 year treasury yield every day or more…
Sometimes the lenders have a 1 time rate adjustment but I take it the program you are looking at does not have that eh? That allows you to lock in BUT you also get a 1 time chance to relock during the escrow period.
SD Realtor
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January 23, 2008 at 12:14 PM #141538
SD Realtor
ParticipantTough call man…greedy or smart… usually they do not go hand in hand…let’s just say you are trying to get the best rate possible and leave it at that.
Like I said, I am not expert on the bond market. That is where guys like Chris S and the experts come in. All I can tell you is to keep checking that 10 year treasury yield every day or more…
Sometimes the lenders have a 1 time rate adjustment but I take it the program you are looking at does not have that eh? That allows you to lock in BUT you also get a 1 time chance to relock during the escrow period.
SD Realtor
-
January 23, 2008 at 12:14 PM #141597
SD Realtor
ParticipantTough call man…greedy or smart… usually they do not go hand in hand…let’s just say you are trying to get the best rate possible and leave it at that.
Like I said, I am not expert on the bond market. That is where guys like Chris S and the experts come in. All I can tell you is to keep checking that 10 year treasury yield every day or more…
Sometimes the lenders have a 1 time rate adjustment but I take it the program you are looking at does not have that eh? That allows you to lock in BUT you also get a 1 time chance to relock during the escrow period.
SD Realtor
-
January 23, 2008 at 11:53 AM #141494
kicksavedave
ParticipantGreat thread and very timely info for me. I’m 60 days from closing on the new home near Denver. The builders lender has offered a 95% loan for 5.65% with the PMI built in and they will pay all the closing cost. They want me to lock that in but I see little to no upside in doing that right now, only downside with the 10 and 30 T’s yields plummeting. I’m going to let it ride in hopes that another 1/4 point or more drop in the next 60 days materializes.
Am I being greedy, or smart?
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January 23, 2008 at 11:53 AM #141506
kicksavedave
ParticipantGreat thread and very timely info for me. I’m 60 days from closing on the new home near Denver. The builders lender has offered a 95% loan for 5.65% with the PMI built in and they will pay all the closing cost. They want me to lock that in but I see little to no upside in doing that right now, only downside with the 10 and 30 T’s yields plummeting. I’m going to let it ride in hopes that another 1/4 point or more drop in the next 60 days materializes.
Am I being greedy, or smart?
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January 23, 2008 at 11:53 AM #141533
kicksavedave
ParticipantGreat thread and very timely info for me. I’m 60 days from closing on the new home near Denver. The builders lender has offered a 95% loan for 5.65% with the PMI built in and they will pay all the closing cost. They want me to lock that in but I see little to no upside in doing that right now, only downside with the 10 and 30 T’s yields plummeting. I’m going to let it ride in hopes that another 1/4 point or more drop in the next 60 days materializes.
Am I being greedy, or smart?
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January 23, 2008 at 11:53 AM #141592
kicksavedave
ParticipantGreat thread and very timely info for me. I’m 60 days from closing on the new home near Denver. The builders lender has offered a 95% loan for 5.65% with the PMI built in and they will pay all the closing cost. They want me to lock that in but I see little to no upside in doing that right now, only downside with the 10 and 30 T’s yields plummeting. I’m going to let it ride in hopes that another 1/4 point or more drop in the next 60 days materializes.
Am I being greedy, or smart?
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January 23, 2008 at 11:29 AM #141478
SD Realtor
ParticipantGuys –
HLS or Pasadena broker and mortgage professionals have more expert takes then I do. With that said long term mortgages have ALWAYS trended in the same direction of the 10/30 year treasury yields. The risk premium that is built in by the originators will fluctuate based on many factors but mostly on the secondary market. When we saw the secondary market lockup in August, that risk premium jumped way up. However memories are short and it went down after several weeks. Obviously the risk premium for a conforming loan that is FHA approved is the lowest. The premiums go up with jumbos, etc…
Now how low will rates go? Don’t know and don’t have a clue. Will they TREND in the same direction as the long term treasury yield? Absolutely. Will the risk premiums vary? Absolutely.
Your mission then is to find the best time, that is when the 10 or 30 year treasury yield is low AND the risk premium is low. Since you do not have much knowledge of the risk premium all you can do is monitor the 10 year.
Of course there is continuing bad news about foreclosures but for people to think mortgage rates will not budge while the 10 year yield plummets is not realistic.
Finally, long term rates do not just move lock step with the 10 year. As any shmuck in life knows, you get screwed on the way down and double screwed on the way up. In other words, lenders are sticky on the way down and they will not lower rates immediately even though the 10 year may go down. They may wait a day or a few days to make sure it doesnt spike back up, then they will lower them. Also many times one will not lower a rate until the other does, then they all do at once. Of course the SECOND the yield moves back up they all raise rates up immediately.
SD Realtor
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January 23, 2008 at 11:29 AM #141490
SD Realtor
ParticipantGuys –
HLS or Pasadena broker and mortgage professionals have more expert takes then I do. With that said long term mortgages have ALWAYS trended in the same direction of the 10/30 year treasury yields. The risk premium that is built in by the originators will fluctuate based on many factors but mostly on the secondary market. When we saw the secondary market lockup in August, that risk premium jumped way up. However memories are short and it went down after several weeks. Obviously the risk premium for a conforming loan that is FHA approved is the lowest. The premiums go up with jumbos, etc…
Now how low will rates go? Don’t know and don’t have a clue. Will they TREND in the same direction as the long term treasury yield? Absolutely. Will the risk premiums vary? Absolutely.
Your mission then is to find the best time, that is when the 10 or 30 year treasury yield is low AND the risk premium is low. Since you do not have much knowledge of the risk premium all you can do is monitor the 10 year.
Of course there is continuing bad news about foreclosures but for people to think mortgage rates will not budge while the 10 year yield plummets is not realistic.
Finally, long term rates do not just move lock step with the 10 year. As any shmuck in life knows, you get screwed on the way down and double screwed on the way up. In other words, lenders are sticky on the way down and they will not lower rates immediately even though the 10 year may go down. They may wait a day or a few days to make sure it doesnt spike back up, then they will lower them. Also many times one will not lower a rate until the other does, then they all do at once. Of course the SECOND the yield moves back up they all raise rates up immediately.
SD Realtor
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January 23, 2008 at 11:29 AM #141518
SD Realtor
ParticipantGuys –
HLS or Pasadena broker and mortgage professionals have more expert takes then I do. With that said long term mortgages have ALWAYS trended in the same direction of the 10/30 year treasury yields. The risk premium that is built in by the originators will fluctuate based on many factors but mostly on the secondary market. When we saw the secondary market lockup in August, that risk premium jumped way up. However memories are short and it went down after several weeks. Obviously the risk premium for a conforming loan that is FHA approved is the lowest. The premiums go up with jumbos, etc…
Now how low will rates go? Don’t know and don’t have a clue. Will they TREND in the same direction as the long term treasury yield? Absolutely. Will the risk premiums vary? Absolutely.
Your mission then is to find the best time, that is when the 10 or 30 year treasury yield is low AND the risk premium is low. Since you do not have much knowledge of the risk premium all you can do is monitor the 10 year.
Of course there is continuing bad news about foreclosures but for people to think mortgage rates will not budge while the 10 year yield plummets is not realistic.
Finally, long term rates do not just move lock step with the 10 year. As any shmuck in life knows, you get screwed on the way down and double screwed on the way up. In other words, lenders are sticky on the way down and they will not lower rates immediately even though the 10 year may go down. They may wait a day or a few days to make sure it doesnt spike back up, then they will lower them. Also many times one will not lower a rate until the other does, then they all do at once. Of course the SECOND the yield moves back up they all raise rates up immediately.
SD Realtor
-
January 23, 2008 at 11:29 AM #141576
SD Realtor
ParticipantGuys –
HLS or Pasadena broker and mortgage professionals have more expert takes then I do. With that said long term mortgages have ALWAYS trended in the same direction of the 10/30 year treasury yields. The risk premium that is built in by the originators will fluctuate based on many factors but mostly on the secondary market. When we saw the secondary market lockup in August, that risk premium jumped way up. However memories are short and it went down after several weeks. Obviously the risk premium for a conforming loan that is FHA approved is the lowest. The premiums go up with jumbos, etc…
Now how low will rates go? Don’t know and don’t have a clue. Will they TREND in the same direction as the long term treasury yield? Absolutely. Will the risk premiums vary? Absolutely.
Your mission then is to find the best time, that is when the 10 or 30 year treasury yield is low AND the risk premium is low. Since you do not have much knowledge of the risk premium all you can do is monitor the 10 year.
Of course there is continuing bad news about foreclosures but for people to think mortgage rates will not budge while the 10 year yield plummets is not realistic.
Finally, long term rates do not just move lock step with the 10 year. As any shmuck in life knows, you get screwed on the way down and double screwed on the way up. In other words, lenders are sticky on the way down and they will not lower rates immediately even though the 10 year may go down. They may wait a day or a few days to make sure it doesnt spike back up, then they will lower them. Also many times one will not lower a rate until the other does, then they all do at once. Of course the SECOND the yield moves back up they all raise rates up immediately.
SD Realtor
-
-
January 23, 2008 at 10:15 AM #141416
cashflow
ParticipantHi SD R,
I’m watching this closely as well as we want to refi our rental home. I noticed on Bankrate that usually I would get up to 10 different quotes, now I’m only seeing about 5 come up for this area….do you think this is due to the credit crunch, just not as many willing to finance in this region?? Mortgage Capital Assoc. usually had lower rates and quote a reasonable fee, they are at 5.1% today…not too bad…
What are your thoughts on how low this could go? I’m excited to get this done though and long term have a great rate and save some $$$. On the flipside, we too had a CD resetting, but it locked in beggining of month, still not too good though.
Can’t have it all!
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January 23, 2008 at 10:15 AM #141430
cashflow
ParticipantHi SD R,
I’m watching this closely as well as we want to refi our rental home. I noticed on Bankrate that usually I would get up to 10 different quotes, now I’m only seeing about 5 come up for this area….do you think this is due to the credit crunch, just not as many willing to finance in this region?? Mortgage Capital Assoc. usually had lower rates and quote a reasonable fee, they are at 5.1% today…not too bad…
What are your thoughts on how low this could go? I’m excited to get this done though and long term have a great rate and save some $$$. On the flipside, we too had a CD resetting, but it locked in beggining of month, still not too good though.
Can’t have it all!
-
January 23, 2008 at 10:15 AM #141459
cashflow
ParticipantHi SD R,
I’m watching this closely as well as we want to refi our rental home. I noticed on Bankrate that usually I would get up to 10 different quotes, now I’m only seeing about 5 come up for this area….do you think this is due to the credit crunch, just not as many willing to finance in this region?? Mortgage Capital Assoc. usually had lower rates and quote a reasonable fee, they are at 5.1% today…not too bad…
What are your thoughts on how low this could go? I’m excited to get this done though and long term have a great rate and save some $$$. On the flipside, we too had a CD resetting, but it locked in beggining of month, still not too good though.
Can’t have it all!
-
January 23, 2008 at 10:15 AM #141515
cashflow
ParticipantHi SD R,
I’m watching this closely as well as we want to refi our rental home. I noticed on Bankrate that usually I would get up to 10 different quotes, now I’m only seeing about 5 come up for this area….do you think this is due to the credit crunch, just not as many willing to finance in this region?? Mortgage Capital Assoc. usually had lower rates and quote a reasonable fee, they are at 5.1% today…not too bad…
What are your thoughts on how low this could go? I’m excited to get this done though and long term have a great rate and save some $$$. On the flipside, we too had a CD resetting, but it locked in beggining of month, still not too good though.
Can’t have it all!
-
January 23, 2008 at 10:28 AM #141201
Fearful
ParticipantI can understand funds flowing to 10yr from the stock market.
However, I cannot understand funds flowing in to mortgages.
Anybody that can help me understand why mortgage rates have been going down lately?
-
January 23, 2008 at 10:42 AM #141216
Eugene
ParticipantBecause so far delinquency/default rates of fixed rate mortgages were negligible. As far as investors are concerned, housing problems are still confined to subprime and adjustable-rate markets.
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January 23, 2008 at 11:12 AM #141241
Fearful
ParticipantSounds reasonable; also, Fannie does not do a good job of assessing default risk when buying mortgages.
Jumbos have come down, too, though not as much as conforming.
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January 23, 2008 at 11:12 AM #141468
Fearful
ParticipantSounds reasonable; also, Fannie does not do a good job of assessing default risk when buying mortgages.
Jumbos have come down, too, though not as much as conforming.
-
January 23, 2008 at 11:12 AM #141481
Fearful
ParticipantSounds reasonable; also, Fannie does not do a good job of assessing default risk when buying mortgages.
Jumbos have come down, too, though not as much as conforming.
-
January 23, 2008 at 11:12 AM #141509
Fearful
ParticipantSounds reasonable; also, Fannie does not do a good job of assessing default risk when buying mortgages.
Jumbos have come down, too, though not as much as conforming.
-
January 23, 2008 at 11:12 AM #141567
Fearful
ParticipantSounds reasonable; also, Fannie does not do a good job of assessing default risk when buying mortgages.
Jumbos have come down, too, though not as much as conforming.
-
-
January 23, 2008 at 10:42 AM #141443
Eugene
ParticipantBecause so far delinquency/default rates of fixed rate mortgages were negligible. As far as investors are concerned, housing problems are still confined to subprime and adjustable-rate markets.
-
January 23, 2008 at 10:42 AM #141455
Eugene
ParticipantBecause so far delinquency/default rates of fixed rate mortgages were negligible. As far as investors are concerned, housing problems are still confined to subprime and adjustable-rate markets.
-
January 23, 2008 at 10:42 AM #141484
Eugene
ParticipantBecause so far delinquency/default rates of fixed rate mortgages were negligible. As far as investors are concerned, housing problems are still confined to subprime and adjustable-rate markets.
-
January 23, 2008 at 10:42 AM #141540
Eugene
ParticipantBecause so far delinquency/default rates of fixed rate mortgages were negligible. As far as investors are concerned, housing problems are still confined to subprime and adjustable-rate markets.
-
-
January 23, 2008 at 10:28 AM #141426
Fearful
ParticipantI can understand funds flowing to 10yr from the stock market.
However, I cannot understand funds flowing in to mortgages.
Anybody that can help me understand why mortgage rates have been going down lately?
-
January 23, 2008 at 10:28 AM #141440
Fearful
ParticipantI can understand funds flowing to 10yr from the stock market.
However, I cannot understand funds flowing in to mortgages.
Anybody that can help me understand why mortgage rates have been going down lately?
-
January 23, 2008 at 10:28 AM #141469
Fearful
ParticipantI can understand funds flowing to 10yr from the stock market.
However, I cannot understand funds flowing in to mortgages.
Anybody that can help me understand why mortgage rates have been going down lately?
-
January 23, 2008 at 10:28 AM #141525
Fearful
ParticipantI can understand funds flowing to 10yr from the stock market.
However, I cannot understand funds flowing in to mortgages.
Anybody that can help me understand why mortgage rates have been going down lately?
-
April 17, 2008 at 1:54 AM #188843
gdcox
ParticipantThe 10 year yield is acting like gold at this time. It is a bellweather to to bad times in the sense that the more gloom the more it will fall; even at today’s levels. However, since many are now calling for the worst of the crisis to be coming to an end (ie over the hump of the chart of shocks) , there is more of a symmetric risk : ie there is a real chance of less pessimism leading to a higher ten year rate. So we may be near to bottom for ten year yields.
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April 17, 2008 at 1:54 AM #188866
gdcox
ParticipantThe 10 year yield is acting like gold at this time. It is a bellweather to to bad times in the sense that the more gloom the more it will fall; even at today’s levels. However, since many are now calling for the worst of the crisis to be coming to an end (ie over the hump of the chart of shocks) , there is more of a symmetric risk : ie there is a real chance of less pessimism leading to a higher ten year rate. So we may be near to bottom for ten year yields.
-
April 17, 2008 at 1:54 AM #188894
gdcox
ParticipantThe 10 year yield is acting like gold at this time. It is a bellweather to to bad times in the sense that the more gloom the more it will fall; even at today’s levels. However, since many are now calling for the worst of the crisis to be coming to an end (ie over the hump of the chart of shocks) , there is more of a symmetric risk : ie there is a real chance of less pessimism leading to a higher ten year rate. So we may be near to bottom for ten year yields.
-
April 17, 2008 at 1:54 AM #188906
gdcox
ParticipantThe 10 year yield is acting like gold at this time. It is a bellweather to to bad times in the sense that the more gloom the more it will fall; even at today’s levels. However, since many are now calling for the worst of the crisis to be coming to an end (ie over the hump of the chart of shocks) , there is more of a symmetric risk : ie there is a real chance of less pessimism leading to a higher ten year rate. So we may be near to bottom for ten year yields.
-
April 17, 2008 at 1:54 AM #188912
gdcox
ParticipantThe 10 year yield is acting like gold at this time. It is a bellweather to to bad times in the sense that the more gloom the more it will fall; even at today’s levels. However, since many are now calling for the worst of the crisis to be coming to an end (ie over the hump of the chart of shocks) , there is more of a symmetric risk : ie there is a real chance of less pessimism leading to a higher ten year rate. So we may be near to bottom for ten year yields.
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