LOS ANGELES, CA – Feb. 16 (FreeRateUpdate.com) – Mortgage rates seem to be edging down. Despite a stock market rally, which usually involves investors moving away from bonds for bigger profits hurting mortgage rates, mortgage-backed securities gained today +5/32 (FNMA 30-yr 4.5 at 101.03) strengthening mortgage rates. 30 year fixed mortgage rates for conforming and FHA loans at par remain at 4.75%.
MBS prices have continued to rise since January’s lows. As a result of the rise in MBS prices, mortgage rates for conforming and FHA mortgages, which move opposite, have slowly but steadily improved moving from above 5% to well below.
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Tomorrow, we could see bigger movements in MBS prices effecting mortgage rates as Housing Starts, Import Prices, Industrial Production, and the FOMC Minutes will be released throughout the day. If the majority of data released tomorrow is disappointing it’s likely 30 year fixed mortgage rates could dip rather than just a pricing improvement as we saw today. Today’s gains for MBS prices caused closing costs to go down. 4.75% will cost consumers and lenders alike less than it did yesterday. The benchmark 10 year treasury yield, used to forecast 30 year fixed mortgage rates, closed lower -0.03 and at 3.66.
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