Tuesday, October 6, 2009

Phoenix Home Mortgage Interest Rate Update and Recommendation Oct 6th, 2009 - FLOAT or LOCK?

Current Pricing of FNMA 30 Year 4.5% Bond: $101.62
-9 bps (Prior Close – $101.71)

Market Update: Mortgage Backed Security (MBS) pricing is lower this morning from yesterday's closing price. Like yesterday's update, Bond prices are still showing technical signs of heading lower, which would make home loan interest rates move higher.

Economic News: The Reserve Bank of Australia unexpectedly raised the country's benchmark interest rate, stating they felt it was safe to start cutting back on economic stimulus. This would normally be good news for Bonds because raising interest rates keeps inflation low. However, this caused pressure on the dollar, raising commodity prices and the Stock market.

Recommendation: FLOAT

For information on purchasing or refinancing your home loan contact The Krushinsky Team at 623-594-7600 or email david.krushinsky@wjbradley.com.

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