Florida Mortgage Rates – Midday Report

by Florida's #1 Mortgage Planner on June 8, 2009

Locking Stance: LOCKING    Mortgage Bonds :-38bp

Mortgage backed securities have obviously fallen since this morning’s report, which was not unexpected as I had mentioned.  MBS pricing is now testing another layer of support, which may very well hold absent any catalyst to push them through. 

Talk of the Fed’s adding even more money to their virtually bottomless money pit to be used to buy mortgage backed securities has surfaced yet again.  If you remember, just before the last FOMC Meeting I had mentioned that they may make an announcement at that meeting.  The fact was, as seen in the FOMC Minutes released later was that they thought about it and shelved it for the time being.  Well, you have seen what has happened to the markets since then, so it is no surprise that the same talk is the gossip of the day.  Some have even wondered why they haven’t just made an announcement just to appease the markets.

Well, one thing is for sure, on a day when the Dow Jones Industrial Average is down over 100 points, MBS prices should be rising, not falling.  And that is especially with the rumor mill running.  The bottom line is traders are demanding better rates of return based on the risks involved and the underlying issues as I described in this week’s Mortgage Market Update over at Lenderama.

What does this mean for Florida Mortgage Rates?  Mortgage rates are still on the rise and we have yet to say that brief period for floating that I mentioned earlier.  Once again, the risks are too great to bet on lower mortgage rates, at least for now.

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