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Los Angeles Mortgage Rates report: July 3, 2008

Mortgage rates in Los Angeles for July 3, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.750%
10/1 ARM            6.000% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:       Lower

Next 30 days:      Neutral 

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

                                                                                            

Mortgage rates in Los Angeles for July 3, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.750%
10/1 ARM            6.000% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:       Lower

Next 30 days:      Neutral 

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Mortgage rates in Los Angeles for July 3, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.750%
10/1 ARM            6.000% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:       Lower

Next 30 days:      Neutral 

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Mortgage rates in Los Angeles for July 3, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.750%
10/1 ARM            6.000% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:       Lower

Next 30 days:      Neutral 

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Mortgage rates in Los Angeles for July 3, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.750%
10/1 ARM            6.000% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:       Lower

Next 30 days:      Neutral 

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Los Angeles Mortgage Rates Report: July 2, 2008

Mortgage rates in Los Angeles for July 2, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.625%
10/1 ARM             6.000% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:       Slightly Lower

Next 30 days:      Neutral 

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Mortgage rates in Los Angeles for July 2, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.625%
10/1 ARM             6.000% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:       Slightly Lower

Next 30 days:      Neutral 

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Mortgage rates in Los Angeles for July 2, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.625%
10/1 ARM             6.000% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:       Slightly Lower

Next 30 days:      Neutral 

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Mortgage rates in Los Angeles for July 2, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.625%
10/1 ARM             6.000% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:       Slightly Lower

Next 30 days:      Neutral 

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Los Angeles Mortgage Rates Report: July 1, 2008

Mortgage rates in Los Angeles for July 1, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.750%
10/1 ARM            5.875% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:        Slightly Lower

Next 30 days:      Slightly Higher

Next 3 months:     Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Mortgage rates in Los Angeles for July 1, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.750%
10/1 ARM            5.875% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:        Slightly Lower

Next 30 days:      Slightly Higher

Next 3 months:     Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Mortgage rates in Los Angeles for July 1, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.750%
10/1 ARM            5.875% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:        Slightly Lower

Next 30 days:      Slightly Higher

Next 3 months:     Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Los Angeles Mortgage Rates Report: June 30, 2008

Mortgage rates in Los Angeles for June 30, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.750%
10/1 ARM            5.875% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:        Slightly Lower

Next 30 days:      Slightly Higher

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Mortgage rates in Los Angeles for June 30, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.750%
10/1 ARM            5.875% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:        Slightly Lower

Next 30 days:      Slightly Higher

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Mortgage rates in Los Angeles for June 30, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.250%
5/1 ARM              5.500%
7/1 ARM              5.750%
10/1 ARM            5.875% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a purchase transaction with a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.  Custom rate quotes and fixed rate mortgages are available by calling at the number below..

LOS ANGELES MORTGAGE RATE TREND:

Next 7 days:        Slightly Lower

Next 30 days:      Slightly Higher

Next 3 months:    Higher

Brian Brady
(858)-777-9751
Apply for a loan online

Los Angeles Mortgage Rates Report: June 27, 2008

Mortgage rates in Los Angeles for June 27, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.125%
5/1 ARM              5.500%
7/1 ARM              5.625%
10/1 ARM            5.875% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.

Brian Brady
(858)-777-9751
Apply for a loan online

Mortgage rates in Los Angeles for June 27, 2008.  Loan amounts up to $417,000:

3/1 ARM              5.125%
5/1 ARM              5.500%
7/1 ARM              5.625%
10/1 ARM            5.875% 

All rates offered to the borrower with 1 point cost.  Rate quotes assume a 20% down payment, 720 credit score, and full income qualification.  Rates are subject to fluctuation.

Brian Brady
(858)-777-9751
Apply for a loan online

Los Angeles Mortgage Rates Report: June 25, 2008

No recommendation about Los Angeles mortgage rates until tomorrow.  All eyes are on the Federal Reserve Open Market Committee today.  At 2:15PM (EDT), 11:15 (PDT), they will release their interest rate decision and statement.  The fixed income securities market believe there is a 43% chance that the Fed will RAISE rates, to stifle inflation, in August and that there is a 61% chance that the hike will come in November.

The eyes will be on the Fed's commentary, though:

"We expect the Fed to keep the funds rate at 2% today but to shift to a more hawkish statement by placing more emphasis on inflation over growth risks," strategists at Credit Suisse wrote in a research report. "The Fed will likely use this meeting as an opportunity to set the stage for a potential rate rise in August."

If the Fed signals that rates could rise as early as August, expect Los Angeles mortgage rates to jump .25% higher, from today's 6.375% 30 year fixed rate, over the next few weeks.  If the Fed signals rate hikes are "possible" as a way to fight inflation, expect rates to stay level through in July (6.25% to 6.5%).  Finally, if the Fed shifts back to its anti-recessionary talk, we could see rates drop down to 6%.

As you can see, there are a lot of "ifs".  This is why today's Fed commentary is all important.  The Fed's ambiguity has traders convinced that higher rates are a foregone conclusion.  Here's the silver lining hidden in this dark cloud; mortgage rates are equal to what they were in July, 2007.  The Fed Funds rate was at 5.25%, then. Today, the Fed funds rate is at 2.25%.  What that means is that mortgage rates SHOULD be able to withstand some 5-6 rate hikes and stay under 7%.

Alas, markets are discounting mechanisms.  We still think there is a lot of risk to higher mortgage rates until the commodities bubble bursts.

Los Angeles Mortgage Rates Report: June 19, 2008

We're still advising all Los Angeles borrowers to lock all mortgage rates at application.  The risk of the Fed raising rates far exceeds the opportunity for lower term rates.  Watch this one minute video to understand what exactly has been happening in the mortgage markets, since May 2, 2008 and what I think WILL happen in the near term future. Brian Brady Mortgage Planner 858-777-9751

Los Angeles Mortgage Rates Report: June 12, 2008

Los Angeles mortgage rates are headed higher.  Lock all rates at application, regardless of closing date.

The trend is clear; the Fed believes it has done all it can to stave off the banking crises and is now focusing its efforts on inflation. This morning, retail sales were up and the dollar is strengthening.  If stagflation is the fear, the current strategy of targeting core inflation may be abandoned for the more radical Paul Volcker-style approach to tame inflation. 

While I believe the higher mortgage rate cycle will be shorter than the 80-s style interest rate hikes, it's clear to me that Bernanke is talking differently than he did in 2006 and 2007.  The effect?  We could see mortgage rates rise as much as 2% in the next two years.  I still believe that a five year ARM will offer the best solution because interest rates move in cycles; I think we'll see Los Angeles mortgage rates under 6% again in 2011.  Today?  The trend looks like we're headed higher.

What then, should be your strategy?

1- If you were thinking of refinancing your home loan, apply now. There will be little periods of weakness in rates this year and you should jump on any chance you have to get a 5/1 ARM under 6% or a 30 year fixed rate under 6.5%.

2- If you can't get the home loan you want today, get your documentation to me anyway. Secure an approval that is good for 90 days and wait for those periods of weakness to lock in the right rate.

3- If you were thinking of buying a home, mortgage rates are about as good as they'll get for the next two years.  Get pre-approved, contact your REALTOR and start looking.

Brian Brady

(858)-777-9751

brian(at) californialoanconnection (dot) com

For faster service, apply online, fax your most recent paystub, 2007 and 2006 W-2 form, and most recent bank statement to 858-605-4230, and call me immediately.

Los Angeles Mortgage Rates Report: June 9, 2008

Los Angeles mortgage rates are behaving exactly as I expected they would when I reissued my lock recommendation on May 29, 2008.  What then for June, 2008 mortgage rates? 

Expect more volatility.  The Fed's in a weird spot.  The economy is tanking under the pressure of high gas prices and the real estate recession.  The tax rebates are mailed and that money's been spent.  Gasoline is at $4.00/gallon.  Food costs are spiraling from the dumb ethanol energy policy. Ben Bernanke doesn't know if he should be fighting inflation on Monday or preventing a depression on Tuesday. His mixed signals are being perceived as a potential rate hike which has kept Los Angeles mortgage rates above 6% these past two weeks.

A thirty-year fixed rate loan is at 6.375% now.  The 5/1 ARM I loved so much at 5.375% has risen to 5.5%.  I'm not certain that we'll see those rates come down this month.  If you have a June or early July closing, lock your mortgage rate now.  I do, however see the weak economy outweighing the inflationary fear.  The Saudis are attempting to increase production which leads me to believe that they think the bull market in oil is over.  If you have a closing in July, or are considering a refinance, I think you can float your rate until mortgage rates drop below 6%. 

If you're thinking of refinancing, it makes complete sense to start the process now by applying for a home loan. I expect credit guidelines to tighten throughout the summer.  While I think you can hold off on your mortgage rate lock, you should get the documentation in so that the loan can be underwritten in June.  Loan approvals are usually good for 60 days so you can lock and close when rates come back down.

In summary: Lock all loans closing within 30 days, float the rest.

PS:  This could change daily.  Market volatility is such that I could move to an "all float" recommendation if the reaction to the Saudis summit is positive.  If oil gets down below $120/barrel, The Fed won't worry so much about inflation.  As always, keep checking back or subscribe to my RSS feed.

Los Angeles mortgage rates are behaving exactly as I expected they would when I reissued my lock recommendation on May 29, 2008.  What then for June, 2008 mortgage rates? 

Expect more volatility.  The Fed's in a weird spot.  The economy is tanking under the pressure of high gas prices and the real estate recession.  The tax rebates are mailed and that money's been spent.  Gasoline is at $4.00/gallon.  Food costs are spiraling from the dumb ethanol energy policy. Ben Bernanke doesn't know if he should be fighting inflation on Monday or preventing a depression on Tuesday. His mixed signals are being perceived as a potential rate hike which has kept Los Angeles mortgage rates above 6% these past two weeks.

A thirty-year fixed rate loan is at 6.375% now.  The 5/1 ARM I loved so much at 5.375% has risen to 5.5%.  I'm not certain that we'll see those rates come down this month.  If you have a June or early July closing, lock your mortgage rate now.  I do, however see the weak economy outweighing the inflationary fear.  The Saudis are attempting to increase production which leads me to believe that they think the bull market in oil is over.  If you have a closing in July, or are considering a refinance, I think you can float your rate until mortgage rates drop below 6%. 

If you're thinking of refinancing, it makes complete sense to start the process now by applying for a home loan. I expect credit guidelines to tighten throughout the summer.  While I think you can hold off on your mortgage rate lock, you should get the documentation in so that the loan can be underwritten in June.  Loan approvals are usually good for 60 days so you can lock and close when rates come back down.

In summary: Lock all loans closing within 30 days, float the rest.

PS:  This could change daily.  Market volatility is such that I could move to an "all float" recommendation if the reaction to the Saudis summit is positive.  If oil gets down below $120/barrel, The Fed won't worry so much about inflation.  As always, keep checking back or subscribe to my RSS feed.

Los Angeles Mortgage Rates Report: May 29, 2008

"What goes up, must come down.  Spinning Wheel, got to go 'round"
- Blood, Sweat and Tears

This is panic selling that we're seeing in the fixed-income securities market.  I knew it would happen but I was early.  The 30-year fixed rate mortgage was at 5.625%, nine days ago.  Yesterday, it went to 6.0%.  Today a 30 -year fixed rate mortgage is at 6.25%.  Expect rates to be above 6.0% for the next two weeks; we should see them creep down by the end of June to the sub-6 level.

What should you do if you can't wait? Lock in a 5/1 ARM.  Today, that rate is just 5.375%.  That's almost a full percentage point discount to the 30-year fixed rate loan.

Rates will improve...but it's gonna get ugly before it gets better.

"What goes up, must come down.  Spinning Wheel, got to go 'round"
- Blood, Sweat and Tears

This is panic selling that we're seeing in the fixed-income securities market.  I knew it would happen but I was early.  The 30-year fixed rate mortgage was at 5.625%, nine days ago.  Yesterday, it went to 6.0%.  Today a 30 -year fixed rate mortgage is at 6.25%.  Expect rates to be above 6.0% for the next two weeks; we should see them creep down by the end of June to the sub-6 level.

What should you do if you can't wait? Lock in a 5/1 ARM.  Today, that rate is just 5.375%.  That's almost a full percentage point discount to the 30-year fixed rate loan.

Rates will improve...but it's gonna get ugly before it gets better.

"What goes up, must come down.  Spinning Wheel, got to go 'round"
- Blood, Sweat and Tears

This is panic selling that we're seeing in the fixed-income securities market.  I knew it would happen but I was early.  The 30-year fixed rate mortgage was at 5.625%, nine days ago.  Yesterday, it went to 6.0%.  Today a 30 -year fixed rate mortgage is at 6.25%.  Expect rates to be above 6.0% for the next two weeks; we should see them creep down by the end of June to the sub-6 level.

What should you do if you can't wait? Lock in a 5/1 ARM.  Today, that rate is just 5.375%.  That's almost a full percentage point discount to the 30-year fixed rate loan.

Rates will improve...but it's gonna get ugly before it gets better.

Los Angeles Mortgage Rates Report: May 14, 2008

Lock all mortgage rates immediately.  This is a stagflation fear we're seeing:

The central bank can't be ``complacent about inflation,'' Janet Yellen, president of the Fed Bank of San Francisco, said in a speech yesterday. Recent measures of consumers' outlook for prices ``highlight the risk that our attempts to deal with problems in the real economy could lead to higher inflation expectations and an erosion of our credibility,'' she said.   

Yellen also said she anticipates inflation will slow as the labor market weakens and ``commodity prices level off,'' echoing comments by other policy makers.   

Investors project the Fed will keep the benchmark interest rate unchanged at its next meeting on June 25. That would be the first pause since the central bank started cutting rates in September.           

Rising prices from overseas, reflecting the drop in the dollar, are another source of concern. U.S. businesses have leeway to boost prices as companies abroad charge more.

The mortgage markets will overreact for the next 5-10 days.  Mortgage rates should shoot up quickly.

Lock all mortgage rates immediately.  This is a stagflation fear we're seeing:

The central bank can't be ``complacent about inflation,'' Janet Yellen, president of the Fed Bank of San Francisco, said in a speech yesterday. Recent measures of consumers' outlook for prices ``highlight the risk that our attempts to deal with problems in the real economy could lead to higher inflation expectations and an erosion of our credibility,'' she said.   

Yellen also said she anticipates inflation will slow as the labor market weakens and ``commodity prices level off,'' echoing comments by other policy makers.   

Investors project the Fed will keep the benchmark interest rate unchanged at its next meeting on June 25. That would be the first pause since the central bank started cutting rates in September.           

Rising prices from overseas, reflecting the drop in the dollar, are another source of concern. U.S. businesses have leeway to boost prices as companies abroad charge more.

The mortgage markets will overreact for the next 5-10 days.  Mortgage rates should shoot up quickly.

Los Angeles Mortgage Rates Report: May 12, 2008

Los Angeles mortgage rates dropped, then rose to their original level, last week.  I've been advising  mortgage borrowers to lock all rates at application, regardless of closing date.  Did I miss an opportunity to improve clients' rates?  I don't think so.  My approach is more one of limiting losses than improving gains and last week, I thought there was a threat of higher mortgage rates in Los Angeles; I still do.

Inflation data is released Wednesday and Unemployment data is due out Thursday.  These two figures could be the tempest in the teapot and really affect mortgage rates.  We just think there is too much risk to be floating (holding out for a better rate).  If markets overreact (and they usually do) we'll change that recommendation but for now, we think it's prudent to lock your mortgage rates.

Currently, the 5/1 ARM offers the best value at 4.875% wholesale rate.  The 30 year fixed rate loan is 5.875% wholesale rate.  While there is risk in losing the rate after 5 years, most borrowers don't hold a mortgage that long.  If you are thinking of moving in the next few years, it would be well to examine the benefits of refinancing your home loan to a low 5/1 ARM rate.

Contact me at (858)-777-9751 with questions.

Los Angeles Mortgage Rates Report: May 2, 2008

Let's lock all mortgages rates at application, regardless of when its closing.  I think this is about as good as it gets for a while.  I still see 30 year fixed rates a tad under 6% (5.875%) but the good economic data, released today, could drive Los Angeles mortgage rates up next week.

I recommend a 7/1 ARM today.  Rates offered for a 7/1 ARM, for loans under $417,000, are OVER a half a percentage point less than the 30 year fixed (5.25%).  Most borrowers will feel comfortable with a seven year time frame.  This means that 5.25% rate is locked in for 7 years- that's until 2015.

(all loans offered to the consumer at the wholesale or "par" rate.  We are paid 1% by the consumer.)

To give you an idea of how long 7 years is, Disneyland's California Adventure opened in early 2001.  You probably thought it was around forever.

The bond traders won't be merciful next week unless recessionary data are overwhelming.  Jump on these low rates now.

Let's lock all mortgages rates at application, regardless of when its closing.  I think this is about as good as it gets for a while.  I still see 30 year fixed rates a tad under 6% (5.875%) but the good economic data, released today, could drive Los Angeles mortgage rates up next week.

I recommend a 7/1 ARM today.  Rates offered for a 7/1 ARM, for loans under $417,000, are OVER a half a percentage point less than the 30 year fixed (5.25%).  Most borrowers will feel comfortable with a seven year time frame.  This means that 5.25% rate is locked in for 7 years- that's until 2015.

(all loans offered to the consumer at the wholesale or "par" rate.  We are paid 1% by the consumer.)

To give you an idea of how long 7 years is, Disneyland's California Adventure opened in early 2001.  You probably thought it was around forever.

The bond traders won't be merciful next week unless recessionary data are overwhelming.  Jump on these low rates now.

Los Angeles Mortgage Rates Report: April 29, 2008

No real change in my posture.  I still believe that Los Angeles mortgage rates have room to go lower in the next 30-90 days but I'm advising clients who are closing in less than 17 days to lock. All others can float.

Mortgage-backed securities traders have "baked in" a .25% rate cut from the Fed when they meet tomorrow.  If Bernanke doesn't cut, mortgage rates will jump quickly.  This week is filled with economic data. If the data are reported weaker than the estimates, we could see lower mortgage rates in the next week.  The risk of that not happening, in this volatile market, is real so I'm sticking to the recommendation of locking your loans if you are closing before May 15.

Countrywide Financial  reported a a big loss from foreclosures while MasterCard reported huge profits.  While MasterCard doesn't actually issue the cards (they just make money from transactions), it shows that people are walking away from their mortgages and using credit cards more frequently.  Traders think that Bernanke is fixing the financial crisis in this country but those two events should give you reason to deliberate.  We're still bouncing around on choppy seas and should be through the end of the year.  I just don't see Los Angeles mortgage rates above the 6.5% level at all this year.

No real change in my posture.  I still believe that Los Angeles mortgage rates have room to go lower in the next 30-90 days but I'm advising clients who are closing in less than 17 days to lock. All others can float.

Mortgage-backed securities traders have "baked in" a .25% rate cut from the Fed when they meet tomorrow.  If Bernanke doesn't cut, mortgage rates will jump quickly.  This week is filled with economic data. If the data are reported weaker than the estimates, we could see lower mortgage rates in the next week.  The risk of that not happening, in this volatile market, is real so I'm sticking to the recommendation of locking your loans if you are closing before May 15.

Countrywide Financial  reported a a big loss from foreclosures while MasterCard reported huge profits.  While MasterCard doesn't actually issue the cards (they just make money from transactions), it shows that people are walking away from their mortgages and using credit cards more frequently.  Traders think that Bernanke is fixing the financial crisis in this country but those two events should give you reason to deliberate.  We're still bouncing around on choppy seas and should be through the end of the year.  I just don't see Los Angeles mortgage rates above the 6.5% level at all this year.

Los Angeles Mortgage Rates Report- April 21, 2008

What a wild week this past one was for Los Angeles mortgage rates.  On April 14, 2008, I advised folks who were closing in the month of April to lock rates; mortgage bonds plummeted from 101 to 99.5.  If you were closing in April and didn't lock your mortgage rate, it would have cost you about 1.5% in discount points to get that same mortgage rate, on Thursday- that's $7,500 extra in closing costs for a $500,000 loan!

I also advised that all May closings float. Mortgage bond prices rebounded to 100.5 today; I still think there's room for upside in the mortgage bond market which means lower mortgage rates.  I don't have high hopes for the American economy through the summer.  The foreclosures, weak housing prices, and credit crunch have closed the consumer's "virtual ATM ".  Higher food and fuel prices are starting to take a bite out of the consumers' budget.  A gallon of gas and a gallon of milk both cost in excess of $4. In past years, a homeowner would suck it up and throw the money on his HELOC.  Now, with HELOCs frozen, the consumer has to tighten his belt.

The consumer drives much of the American economy so his tightened belt means less spending.  That should hurt this economy until we see the banks loosen up a bit.

Will we see lower mortgage rates in May?  I think so but the volatility of the mortgage bonds market still compels me to advise Los Angeles home buyers to lock their mortgage rates for transactions closing within 14 days.  All longer closings should float...for now.

What a wild week this past one was for Los Angeles mortgage rates.  On April 14, 2008, I advised folks who were closing in the month of April to lock rates; mortgage bonds plummeted from 101 to 99.5.  If you were closing in April and didn't lock your mortgage rate, it would have cost you about 1.5% in discount points to get that same mortgage rate, on Thursday- that's $7,500 extra in closing costs for a $500,000 loan!

I also advised that all May closings float. Mortgage bond prices rebounded to 100.5 today; I still think there's room for upside in the mortgage bond market which means lower mortgage rates.  I don't have high hopes for the American economy through the summer.  The foreclosures, weak housing prices, and credit crunch have closed the consumer's "virtual ATM ".  Higher food and fuel prices are starting to take a bite out of the consumers' budget.  A gallon of gas and a gallon of milk both cost in excess of $4. In past years, a homeowner would suck it up and throw the money on his HELOC.  Now, with HELOCs frozen, the consumer has to tighten his belt.

The consumer drives much of the American economy so his tightened belt means less spending.  That should hurt this economy until we see the banks loosen up a bit.

Will we see lower mortgage rates in May?  I think so but the volatility of the mortgage bonds market still compels me to advise Los Angeles home buyers to lock their mortgage rates for transactions closing within 14 days.  All longer closings should float...for now.

Los Angeles Mortgage Rates Report: April 14, 2008

I'm still floating mortgage rates, unless my clients are closing within 14 days.  I'm cautiously floating because of the volatility in the market.  Fundamentally, mortgage rates shouldn't have a whole lot more room to come down; the Fed cuts are probably coming to an end.  Something much more drastic than the Fed open market activities will be needed to pull us out of the recession.

Yep.  I said the R word and have been since last fall.  I'm not scared of the recession; I welcome it.  Here's the trick for mortgage rates.  The weak dollar has world investors believing that the Fed's easy money policy is inflationary...

UNTIL...

the recession hits them.  Make no mistake about it, the economic slowdown is a global phenomenon.  Canada and the UK are following suit by cutting rates.  I think the world wide recession will lower oil prices and provide some much needed relief to the American consumer.

Nothing says it like pictures.   I'll show you some charts, to see how I'm thinking. 

One Month FHLMC 5/1 ARM Mortgage Rates

Look at the one-month rate chart (linked above).  We were at 5.5%, on March 13, 2008.  We rose to 5.7%, on March 30, 2008, and declined to 5.6%, today.

Something's wrong! 

Look at the one month mortgage-backed securities market!  It doesn't look like a mirror.  The bond prices have advanced but the mortgage rates haven't come down.   The mortgage rate (for the 5/1 ARM) should be down to 5.3% (or lower).

That's signaling one of two things:  lower bond prices, this week, or lower mortgage rates, this week.  I think the recessionary fears will keep mortgage bond prices high, so I'm opting for lower mortgage rates.

This is what an experienced mortgage planner does on the weekend. Why?  To get you the best rate execution, of course.  The value of an experienced mortgage planner can save you thousands of dollars by knowing WHEN to lock and when NOT to lock your mortgage rate.  Call me at 858-777-9751 to find out how it can benefit you.

I'm still floating mortgage rates, unless my clients are closing within 14 days.  I'm cautiously floating because of the volatility in the market.  Fundamentally, mortgage rates shouldn't have a whole lot more room to come down; the Fed cuts are probably coming to an end.  Something much more drastic than the Fed open market activities will be needed to pull us out of the recession.

Yep.  I said the R word and have been since last fall.  I'm not scared of the recession; I welcome it.  Here's the trick for mortgage rates.  The weak dollar has world investors believing that the Fed's easy money policy is inflationary...

UNTIL...

the recession hits them.  Make no mistake about it, the economic slowdown is a global phenomenon.  Canada and the UK are following suit by cutting rates.  I think the world wide recession will lower oil prices and provide some much needed relief to the American consumer.

Nothing says it like pictures.   I'll show you some charts, to see how I'm thinking. 

One Month FHLMC 5/1 ARM Mortgage Rates

Look at the one-month rate chart (linked above).  We were at 5.5%, on March 13, 2008.  We rose to 5.7%, on March 30, 2008, and declined to 5.6%, today.

Something's wrong! 

Look at the one month mortgage-backed securities market!  It doesn't look like a mirror.  The bond prices have advanced but the mortgage rates haven't come down.   The mortgage rate (for the 5/1 ARM) should be down to 5.3% (or lower).

That's signaling one of two things:  lower bond prices, this week, or lower mortgage rates, this week.  I think the recessionary fears will keep mortgage bond prices high, so I'm opting for lower mortgage rates.

This is what an experienced mortgage planner does on the weekend. Why?  To get you the best rate execution, of course.  The value of an experienced mortgage planner can save you thousands of dollars by knowing WHEN to lock and when NOT to lock your mortgage rate.  Call me at 858-777-9751 to find out how it can benefit you.

Los Angeles Mortgage Rates Report- April 2, 2008

Mortgage rates should decline, in the near term.  I'm changing my recommendation from lock all loans to float all mortgage applications, if the loan is closing more than 14 days out.  That means that if you're scheduled to close on your mortgage, before April 15, 2008, you should lock your mortgage rate.

Fed Chairman Bernanke spoke to Congress this morning.  I'm one of those weird people that actually watch the Fed Chairman's testimony.  I look for a twitch, a nervous tic, or a tenuous posture, in addition to the text of his testimony.  I'm as screwed up as the bond traders on Wall Street.  That was my world; I can't change who I am now.  Well, Bernanke thinks a "contraction" is underway. In Southern California, we call that a recession but we're awfully dramatic in Southern California.  Anyway, recessions contractions lead to lower mortgage rates.

Want to see how effective my lock/float recommendations are?  It looks like I'm always a tad early:

Let's see:

1- I came into the new year, floating rates. 
2-  On January 8, I advised to lock.  I was early, you could have improved your rate by an eighth.
3-  I floated on January 17- bonds improved a full point, then dropped a half a point
4-   Pulled the trigger to lock, on January 24- bonds deteriorated- rates went up.
5-  Stayed locked (but pointed out the ten-year ARM value) throughout February
6-  Went to float, on March 6- bonds improved 3 points, and mortgage rates fell .5%, during that time
7- Have had all loans locked, since March 21-

I'm not bragging, I'm doing my job.  The value of a mortgage planner, who watches the CORRECT influencing factors, can save you an eight to a quarter point, on the rate of  your mortgage.  This means that my advice can save you THOUSANDS of dollars, over the life of the loan.

If you're watching the "points", a stronger bond market can save you a lot of money, on closing costs.  Clients who made an application, on March 8, received a 2% rebate, from the lender, because of my prowess, by waiting until March 21 to lock.  Even worse, those loan applicants that didn't engage me, in February, may have paid as much as 2% MORE, in closing costs, than my clients.

Advice and execution is the value of a skilled mortgage planner.  Ask originators to prove the value of their fee before you hire them.  I'll gladly do just that.

Mortgage rates should decline, in the near term.  I'm changing my recommendation from lock all loans to float all mortgage applications, if the loan is closing more than 14 days out.  That means that if you're scheduled to close on your mortgage, before April 15, 2008, you should lock your mortgage rate.

Fed Chairman Bernanke spoke to Congress this morning.  I'm one of those weird people that actually watch the Fed Chairman's testimony.  I look for a twitch, a nervous tic, or a tenuous posture, in addition to the text of his testimony.  I'm as screwed up as the bond traders on Wall Street.  That was my world; I can't change who I am now.  Well, Bernanke thinks a "contraction" is underway. In Southern California, we call that a recession but we're awfully dramatic in Southern California.  Anyway, recessions contractions lead to lower mortgage rates.

Want to see how effective my lock/float recommendations are?  It looks like I'm always a tad early:

Let's see:

1- I came into the new year, floating rates. 
2-  On January 8, I advised to lock.  I was early, you could have improved your rate by an eighth.
3-  I floated on January 17- bonds improved a full point, then dropped a half a point
4-   Pulled the trigger to lock, on January 24- bonds deteriorated- rates went up.
5-  Stayed locked (but pointed out the ten-year ARM value) throughout February
6-  Went to float, on March 6- bonds improved 3 points, and mortgage rates fell .5%, during that time
7- Have had all loans locked, since March 21-

I'm not bragging, I'm doing my job.  The value of a mortgage planner, who watches the CORRECT influencing factors, can save you an eight to a quarter point, on the rate of  your mortgage.  This means that my advice can save you THOUSANDS of dollars, over the life of the loan.

If you're watching the "points", a stronger bond market can save you a lot of money, on closing costs.  Clients who made an application, on March 8, received a 2% rebate, from the lender, because of my prowess, by waiting until March 21 to lock.  Even worse, those loan applicants that didn't engage me, in February, may have paid as much as 2% MORE, in closing costs, than my clients.

Advice and execution is the value of a skilled mortgage planner.  Ask originators to prove the value of their fee before you hire them.  I'll gladly do just that.

Los Angeles Mortgage Rates Report- March 21, 2008

Los Angeles mortgage markets are taking pause today, in honor of Good Friday.  It was another dramatic week with Ben Bernanke playing John Wayne.  Last weekend, Bernanke brokered a deal that handed Bear Stearns over to Jamie Dimon and JP Morgan Chase. Last week, a share of Bear Stearns traded for the price of a tankful of gasoline, this week, it trades around the price of a Starbucks cup of coffee.  Fannie Mae and Freddie Mac agreed to buy a lot of mortgages, $200 billion worth to be precise.  This buoyed up the mortgage bonds market and had a positive effect on Los Angeles mortgage rates.

Let's lock those rates, now.  I don't see a whole lot more reward on the horizon and the risk of higher rates will increase next week.

ARM rates are out of whack, again, and the fixed-rate mortgages are the best priced.  Today, the wholesale rate for a 30-year fixed-rate loan is 5.625%.  If you called me, you would get that 30-year fixed rate loan for 1% of the loan amount plus $499 for an APR of 5.89%.  A 15-year fixed rate mortgage can be locked for 4.875% for an APR of 5.15%.  That's about .75% less than what rates were on March 10.  My advice to stay calm, in the face of panic, and float rates, panned out.

If you need specific advice, about a mortgage, contact me here.

Los Angeles mortgage markets are taking pause today, in honor of Good Friday.  It was another dramatic week with Ben Bernanke playing John Wayne.  Last weekend, Bernanke brokered a deal that handed Bear Stearns over to Jamie Dimon and JP Morgan Chase. Last week, a share of Bear Stearns traded for the price of a tankful of gasoline, this week, it trades around the price of a Starbucks cup of coffee.  Fannie Mae and Freddie Mac agreed to buy a lot of mortgages, $200 billion worth to be precise.  This buoyed up the mortgage bonds market and had a positive effect on Los Angeles mortgage rates.

Let's lock those rates, now.  I don't see a whole lot more reward on the horizon and the risk of higher rates will increase next week.

ARM rates are out of whack, again, and the fixed-rate mortgages are the best priced.  Today, the wholesale rate for a 30-year fixed-rate loan is 5.625%.  If you called me, you would get that 30-year fixed rate loan for 1% of the loan amount plus $499 for an APR of 5.89%.  A 15-year fixed rate mortgage can be locked for 4.875% for an APR of 5.15%.  That's about .75% less than what rates were on March 10.  My advice to stay calm, in the face of panic, and float rates, panned out.

If you need specific advice, about a mortgage, contact me here.

Los Angeles mortgage markets are taking pause today, in honor of Good Friday.  It was another dramatic week with Ben Bernanke playing John Wayne.  Last weekend, Bernanke brokered a deal that handed Bear Stearns over to Jamie Dimon and JP Morgan Chase. Last week, a share of Bear Stearns traded for the price of a tankful of gasoline, this week, it trades around the price of a Starbucks cup of coffee.  Fannie Mae and Freddie Mac agreed to buy a lot of mortgages, $200 billion worth to be precise.  This buoyed up the mortgage bonds market and had a positive effect on Los Angeles mortgage rates.

Let's lock those rates, now.  I don't see a whole lot more reward on the horizon and the risk of higher rates will increase next week.

ARM rates are out of whack, again, and the fixed-rate mortgages are the best priced.  Today, the wholesale rate for a 30-year fixed-rate loan is 5.625%.  If you called me, you would get that 30-year fixed rate loan for 1% of the loan amount plus $499 for an APR of 5.89%.  A 15-year fixed rate mortgage can be locked for 4.875% for an APR of 5.15%.  That's about .75% less than what rates were on March 10.  My advice to stay calm, in the face of panic, and float rates, panned out.

If you need specific advice, about a mortgage, contact me here.

Los Angeles Mortgage Rates Report- March 18,2008

The Federal Reserve Bank Cut both the discount rate and federal funds rate .75% today in an effort to stimulate this slowing economy.  While commodities' prices accelerate, the housing market and subsequent liquidity crisis is dragging the economy into a recession. 

We call this phenomenon stagflation and it's REALLY  bad for the economy.  The Fed has been aggressively cutting interest rates and the declining housing market is closing down mortgage companies, investment banking firms, and real estate brokerages.  What more can the Fed do to help?

The Fed can (and will) buy mortgage-backed securities. 

Rather than to buy treasury notes in the open market, the Fed will be buying mortgage-backed securities.  They will want to get those assets off investment banking firms' balance sheets and provide stability to the MBS market.  Remember when I said that only the uneducated pay attention to the treasury note to determine the direction of mortgage rates?  Today is proof.

The spread between treasury notes and mortgage-backed securities has been widening these past six weeks. Why?  America was considered to be a sub-prime nation;  everybody was expected to default on their home loans.  Expect the Fed to prop up the MBS market in the next 4-6 weeks.  That will be bad for treasury notes and good for MBS.

Remember when I compared this to the junk bond crisis of the early 90's and advised you not to panic? Now is the time to take action.  There will be some great opportunities to lock into a low mortgage rates during the rest of this month.  If you're closing a loan in less than 14 days, lock your rate. Otherwise, float and see mortgage rates decline a bit.

I am always available for your question at (858)-777-9751.  March has been a very busy month for us so I may not be able to answer your questions immediately.

The Federal Reserve Bank Cut both the discount rate and federal funds rate .75% today in an effort to stimulate this slowing economy.  While commodities' prices accelerate, the housing market and subsequent liquidity crisis is dragging the economy into a recession. 

We call this phenomenon stagflation and it's REALLY  bad for the economy.  The Fed has been aggressively cutting interest rates and the declining housing market is closing down mortgage companies, investment banking firms, and real estate brokerages.  What more can the Fed do to help?

The Fed can (and will) buy mortgage-backed securities. 

Rather than to buy treasury notes in the open market, the Fed will be buying mortgage-backed securities.  They will want to get those assets off investment banking firms' balance sheets and provide stability to the MBS market.  Remember when I said that only the uneducated pay attention to the treasury note to determine the direction of mortgage rates?  Today is proof.

The spread between treasury notes and mortgage-backed securities has been widening these past six weeks. Why?  America was considered to be a sub-prime nation;  everybody was expected to default on their home loans.  Expect the Fed to prop up the MBS market in the next 4-6 weeks.  That will be bad for treasury notes and good for MBS.

Remember when I compared this to the junk bond crisis of the early 90's and advised you not to panic? Now is the time to take action.  There will be some great opportunities to lock into a low mortgage rates during the rest of this month.  If you're closing a loan in less than 14 days, lock your rate. Otherwise, float and see mortgage rates decline a bit.

I am always available for your question at (858)-777-9751.  March has been a very busy month for us so I may not be able to answer your questions immediately.

Los Angeles Mortgage Rates Report: March 10, 2008

Warren Buffett describes his investment philosophy as being fearful when everyone else is greedy and greedy when everyone is fearful.  Today, fear abounds in the mortgage bonds market and that is driving mortgage rates higher.

Rampant fear is why I'm suggesting that borrowers float their mortgage rate. I had been advising borrowers to lock loans, until all hell broke loose, on March 6,2007.  Investors are worried that the mortgage bonds they hold will be worthless.  This market is a lot like the junk bond market of the late 80s.  Those that panicked lost money; those that kept a cool head, profited.

Today a 30 year fixed rate loan is offered at 6.25%, up from 5.875%, and a 7 year ARM is at 6.125%, up from 4.875%. 

Can you see how much panic there has been in less than a week?

I think the market will calm down and traders will pay attention to the economic figures. The Consumer Price Index is due out Friday and that should be the big market mover.  Float your mortgage rates, for now.  Keep alert and keep checking back.

Contact me at (858)-777-9751 with questions or apply for a mortgage online for a quick response.

Los Angeles Mortgage Rates Report: March 6, 2008

Los Angeles mortgage rates skyrocketed this week and are .5% higher than Monday.  Two things have driven mortgage rates higher:

1- The threat of inflation is omnipresent in every economic report.
2- Two mortgage companies defaulted on their lines of credit.

Remember when I talked about how important it is to use a mortgage planner who subscribes to real-time MBS pricing? 

Why am I so adamant about the fact that the ten-year treasury note is not the determining factor of mortgage rates?  The statement is factually incorrect. While the two securities often move in concert, polarity can occur and sometimes does; this is one of those times.  The ten-year T-note is considered the benchmark, not bellwether fixed-income security.  This means that all other securities are compared to the 10-year T-note (we call that the “spread”).  It is GENERALLY a guiding indicator of ALL rates, however, in times or crisis or exuberance, it can’t be relied upon for other fixed-income securities’ direction.  Spreads to the T-note widen and narrow due to extraneous variables.

Today is what of those times.  Most loan originators will be telling you to lock today because the treasury bond market is up.  Today, I'm telling you to hold off your rate locks until the mortgage market goes through some price discovery.

I think that traders are overreacting to the defaults.  New mortgages, funded today, do not have the same risk to investors as the loans funded in 2003-2006.  The stricter underwriting guidelines will actually be the saving grace; mortgage rates will come back down when Wall Street realizes that the past doesn't equal the present.  Big economic news is due out on tomorrow; the employment report.

So, wait.  Don't lock your mortgage rate today.  You should check Mortgage Rates Report often to see any developments.  While I recommend that you float your mortgage rate (if you don't have it locked already), I could change that recommendation on a dime.

Los Angeles mortgage rates skyrocketed this week and are .5% higher than Monday.  Two things have driven mortgage rates higher:

1- The threat of inflation is omnipresent in every economic report.
2- Two mortgage companies defaulted on their lines of credit.

Remember when I talked about how important it is to use a mortgage planner who subscribes to real-time MBS pricing? 

Why am I so adamant about the fact that the ten-year treasury note is not the determining factor of mortgage rates?  The statement is factually incorrect. While the two securities often move in concert, polarity can occur and sometimes does; this is one of those times.  The ten-year T-note is considered the benchmark, not bellwether fixed-income security.  This means that all other securities are compared to the 10-year T-note (we call that the “spread”).  It is GENERALLY a guiding indicator of ALL rates, however, in times or crisis or exuberance, it can’t be relied upon for other fixed-income securities’ direction.  Spreads to the T-note widen and narrow due to extraneous variables.

Today is what of those times.  Most loan originators will be telling you to lock today because the treasury bond market is up.  Today, I'm telling you to hold off your rate locks until the mortgage market goes through some price discovery.

I think that traders are overreacting to the defaults.  New mortgages, funded today, do not have the same risk to investors as the loans funded in 2003-2006.  The stricter underwriting guidelines will actually be the saving grace; mortgage rates will come back down when Wall Street realizes that the past doesn't equal the present.  Big economic news is due out on tomorrow; the employment report.

So, wait.  Don't lock your mortgage rate today.  You should check Mortgage Rates Report often to see any developments.  While I recommend that you float your mortgage rate (if you don't have it locked already), I could change that recommendation on a dime.

Los Angeles Mortgage Rates Report: March 3, 2008

Lock all interest rates at application.  The unrest in Asian markets is bleeding to the US and traders are more concerned about the inflation risk than the possibility of a recession.  Economists believe that The Fed's easy money policy is really an investor bailout disguised as a recession aversion. They think it's compromising  the integrity of our economy.  As commodities prices (oil, food) accelerate, so may consumer, non-essential prices.

I still favor mid-term ARMs over 30 year-fixed rate loans.  We offer a 7-year fixed period ARM at 4.875% (5.18% apr) while a 30-year fixed rate loan is a full percentage point higher.. When you consider that the average hold time for a mortgage is five years, the 7-year fixed period ARM makes a whole bunch of sense.

It should be a volatile week ahead with lots of economic data being released.  Keep checking www.mortgageratesreport.com for updates.  Want your rate quote and good-faith-estimate reviewed FREE?  Fax it to (858)-605-4230 and call (858)-777-9751 to let me know it's there.

Lock all interest rates at application.  The unrest in Asian markets is bleeding to the US and traders are more concerned about the inflation risk than the possibility of a recession.  Economists believe that The Fed's easy money policy is really an investor bailout disguised as a recession aversion. They think it's compromising  the integrity of our economy.  As commodities prices (oil, food) accelerate, so may consumer, non-essential prices.

I still favor mid-term ARMs over 30 year-fixed rate loans.  We offer a 7-year fixed period ARM at 4.875% (5.18% apr) while a 30-year fixed rate loan is a full percentage point higher.. When you consider that the average hold time for a mortgage is five years, the 7-year fixed period ARM makes a whole bunch of sense.

It should be a volatile week ahead with lots of economic data being released.  Keep checking www.mortgageratesreport.com for updates.  Want your rate quote and good-faith-estimate reviewed FREE?  Fax it to (858)-605-4230 and call (858)-777-9751 to let me know it's there.

Los Angeles Mortgage Rates Report: February 28, 2008

I had a complete meltdown on my Twitter feed, yesterday.  Bernanke told the House that he was concerned about inflation but more concerned about a recession.  I initially reversed my float recommendation and subsequently changed it back to lock because I thought Wall Street would hate Ben's remarks; I was wrong.  I violated the first principle; don't fight the Fed.

The Federal Reserve is worried about a recession.  I think we can expect the Fed to cut rates next month.. The anticipation of that cut gives us a chance to see mortgage rates drift lower.  You should CAUTIOUSLY FLOAT your mortgage rate if your closing is over 7 days away; I think you'll have some room to get a mortgage rate that is .125% to .25% lower than it is today.

We're you paying attention to my Valentine's Day gift of love? I pointed out the hot curves on the 10/1 ARM; it was a full 1% lower than a 30 year fixed.  She's not as sexy as she was last week but the 10/1 ARM is still .5% better in rate than the 30 year fixed.

This morning's report is a bit more dry than the others because today will be busy.  The Gross Domestic Product showed that the economy is teetering on the brink of recession.  That news will be good for mortgage rates.  The market is volatile so always check Mortgage Rates Report for updated recommendations.

BREAKING NEWS: I'll be offering this syndicated column for Home Gain as "National Mortgage Rates Report", every Monday and Thursday.

Los Angeles Mortgage Rates Report: February 25, 2008

I haven't posted much because I'm still locking all mortgage rates, for Los Angeles home buyers, at application.  The market is so volatile because some on Wall Street believe that we're NOT going to have a recession and that the Fed will reverse course and start raising the Discount and Fed Funds rates.

Say What?  Well, I don't make the rules, I follow them.  While I expect to see lower rates in 6 months, today, they're rising faster than a popstar's audience grows.  Of course, what goes up can come crashing down (ask Britt) but today, we're dealing with higher mortgage rates.

The strategy I recommend is to obtain a 10/1 ARM at 5.375% (5.62% apr) with no discount points.  You can lower the rate on that loan to 5.125% by paying a point upfront but it will take over 5 years to recoup that cost; I think you'll sell or refinance during that time (or have an opportunity to do so).  I just can't understand why anyone would want a 30 year fixed AT EXACTLY 1% HIGHER than the 10/1 ARM.

Okay, let's get back to Britney Spears; she'll illustrate my point about the 10/1 ARM.  In 1999, she was 17 years old and the hottest thing since Elvis.  She released her debut album, Baby One More Time, and was the darling of kings and Presidents.  Today, Britt's struggling in rehab and dealing with custody issues.  In ten years, she will find God, get re-married, remake her career, and be considered one of the most influential artists of all time (only in America).  Now, I'm exaggerating to reduce the ten year time frame to the ridiculous.  I only wish the best for Britney and certainly wish the best for you.

That's why I'm so adamant about the ten year ARM.

PS- Want the fastest response in this volatile market?  Apply online and call me at 858-777-9751 right after you apply online.

I haven't posted much because I'm still locking all mortgage rates, for Los Angeles home buyers, at application.  The market is so volatile because some on Wall Street believe that we're NOT going to have a recession and that the Fed will reverse course and start raising the Discount and Fed Funds rates.

Say What?  Well, I don't make the rules, I follow them.  While I expect to see lower rates in 6 months, today, they're rising faster than a popstar's audience grows.  Of course, what goes up can come crashing down (ask Britt) but today, we're dealing with higher mortgage rates.

The strategy I recommend is to obtain a 10/1 ARM at 5.375% (5.62% apr) with no discount points.  You can lower the rate on that loan to 5.125% by paying a point upfront but it will take over 5 years to recoup that cost; I think you'll sell or refinance during that time (or have an opportunity to do so).  I just can't understand why anyone would want a 30 year fixed AT EXACTLY 1% HIGHER than the 10/1 ARM.

Okay, let's get back to Britney Spears; she'll illustrate my point about the 10/1 ARM.  In 1999, she was 17 years old and the hottest thing since Elvis.  She released her debut album, Baby One More Time, and was the darling of kings and Presidents.  Today, Britt's struggling in rehab and dealing with custody issues.  In ten years, she will find God, get re-married, remake her career, and be considered one of the most influential artists of all time (only in America).  Now, I'm exaggerating to reduce the ten year time frame to the ridiculous.  I only wish the best for Britney and certainly wish the best for you.

That's why I'm so adamant about the ten year ARM.

PS- Want the fastest response in this volatile market?  Apply online and call me at 858-777-9751 right after you apply online.

Los Angeles Mortgage Rates Report: February 14, 2007- ARMs Building Muscle

I fell in love with ARMs again, after a five month hiatus.  Hey!  It's Valentine's Day so I can tell you a love story.  This love affair has been going on since I was in my 20s.  The sexy allure of adjustable-rate mortgages were replaced by the stability of that old battle-axe, the fixed rate loan.  The culprit was the flat yield curve.  I dig curves so my eyes popped out of my head when I opened my e-mail this morning.

Adjustable-rate mortgages walked into my life like a wild-eyed, long-haired, bombshell on a Harley, toting a bottle of tequila. Normally, I balance her beauty with the risk she presents but I promise you, she's a changed woman.  This time, she promises to stay put for a ten-year period.  Frankly, ten years is plenty of time for me to outlast a few bumps in the economic road; it's a relationship worth having.

I'm talking about the spread between a 30 year, fixed rate loan and an ARM with a ten-year fixed period.  The 30 year mortgage is around 6.0% while the ten-year fixed rate ARM is offered at 5.25%. Ten years is a LONG time, regardless of the economy, so I'm recommending that over the fixed rate loan.  Let me illustrate how long ten years is for you.  In 1998:

1- Smoking was banned in all California bars and restaurants
2- Mark McGwire broke Roger Maris' single season home run record
3- The Belfast agreement for peace in Northern Ireland was signed.
4- The Padres were in the World Series.
5-  Apple Computer unveiled the iMac
6- Microsoft was convicted of monopoly.
7- Monica Lewinsky redefined the phrase "sexual relations"
8- Google was started.
9- Jesse Ventura was elected Governor of Minnesota
10- The movie Titanic won the Academy Awards.

Do you see where I'm headed with all of this?  Ten years is a long time.  Forget 30 year fixed rate loans if you think you might move, retire, refinance, or send a kid to college between today and 2018.

The ten year loan at 5.25% (5.51% apr) is just too damned sexy!

Please contact me:

Call me at 858-777-9751

E-mail me at brian (at) californialoanconnection (dot) com

Apply for a loan online at http://www.californialoanconnection.com/apply

I fell in love with ARMs again, after a five month hiatus.  Hey!  It's Valentine's Day so I can tell you a love story.  This love affair has been going on since I was in my 20s.  The sexy allure of adjustable-rate mortgages were replaced by the stability of that old battle-axe, the fixed rate loan.  The culprit was the flat yield curve.  I dig curves so my eyes popped out of my head when I opened my e-mail this morning.

Adjustable-rate mortgages walked into my life like a wild-eyed, long-haired, bombshell on a Harley, toting a bottle of tequila. Normally, I balance her beauty with the risk she presents but I promise you, she's a changed woman.  This time, she promises to stay put for a ten-year period.  Frankly, ten years is plenty of time for me to outlast a few bumps in the economic road; it's a relationship worth having.

I'm talking about the spread between a 30 year, fixed rate loan and an ARM with a ten-year fixed period.  The 30 year mortgage is around 6.0% while the ten-year fixed rate ARM is offered at 5.25%. Ten years is a LONG time, regardless of the economy, so I'm recommending that over the fixed rate loan.  Let me illustrate how long ten years is for you.  In 1998:

1- Smoking was banned in all California bars and restaurants
2- Mark McGwire broke Roger Maris' single season home run record
3- The Belfast agreement for peace in Northern Ireland was signed.
4- The Padres were in the World Series.
5-  Apple Computer unveiled the iMac
6- Microsoft was convicted of monopoly.
7- Monica Lewinsky redefined the phrase "sexual relations"
8- Google was started.
9- Jesse Ventura was elected Governor of Minnesota
10- The movie Titanic won the Academy Awards.

Do you see where I'm headed with all of this?  Ten years is a long time.  Forget 30 year fixed rate loans if you think you might move, retire, refinance, or send a kid to college between today and 2018.

The ten year loan at 5.25% (5.51% apr) is just too damned sexy!

Please contact me:

Call me at 858-777-9751

E-mail me at brian (at) californialoanconnection (dot) com

Apply for a loan online at http://www.californialoanconnection.com/apply