Colorado Mortgage Broker

Colorado Mortgage Market Update - by RJ Baxter 6/28/2010 Denver, CO

Good Morning....just a quick update this morning.  On vacation this week in sunny Hilton Head, SC.  We are heading out for a round of golf soon, so hopefully the 100 degree heat and 100% humidty doesn't kill us, if my slices and hooks don't!

As with most vacations I take, it's a "working" vacation this week, so don't hesitate to email me if you need anything.  I will be monitoring emails throughout the week and logging in to work for an hour or two each day.

As for the Colorado Mortgage markets- volatility was rampant last week.  We saw continued downward trends in rates spawned by horrible economic data, and many people locked in low rates mid-week.  Part of this trend was due to commentary from the FOMC's meeting, with Ben Bernanke down-grading the Fed's outlook on the economy.  In light of the recent weak data, including employment and housing, this does not come as a surprise, but must be frustrating for the Fed as they have used nearly all of the arrows in their quiver in an attempt to pull us out of recession.

However, on Thursday, we saw a sharp reversal as Colorado Mortgage rates spiked up.  The net result was that rates ended the week slightly higher than at the beginning of the week.

This week brings the all-important monthly unemployment report and some other economic data.  Remember that positive economic data is bad for Colorado Mortgage rates (higher rates), while negative economic data typically leads to lower Colorado Mortgage rates.

See Today's Colorado Mortgage Rates & find out more about getting a Colorado Home Loan

Mortgage Rates in Denver Colorado 6/21/2010 - by RJ Baxter

Mortgage Rates have stayed low, ending the week last week at near-record lows yet again. 

The reason for the continued rally is an increasing fear that the economy is not on the rebound.  Economic reports of many types came out poorly last week, and poor economic data rends to lead to lower Mortgage Rates.

Unemployment continues to drag down the economy, as weekly claims were released worse than expected.  Also announced was horrible housing starts numbers (housing starts are new home builds), a signal that in the wake of the expiring tax credit, builders are not feeling confident yet in the economy.

Inflation data was also released last week, with CPI, a gage of consumer-related inflation, came in with a tame reading.  Low inflation helps lead to lower Mortgage Rates.

It is interesting with Mortgage Rates at historic lows what the legendary former Fed Chairman Alan Greenspan had to say about the low rates we have been enjoying.  He said that the government appears to have become complacent and instead of using low rates to pay down deficits and balance the budget, they have instead continued to let the budget spiral out of control.  In addition, he reminded his listeners that rates can come up in a hurry, and once they do, it could be very hard to stop the tidal wave.  He cited October 1979-February 1980 which rates rose 4% in that short period.

This week will be action-packed with the FOMC having their meeting.  The policy statement will be closely watched as investors are looking for clues as to the direction of the economy and future Fed rate actions.

For the time being, it is wise to lock in the low Mortgage Rates we have been seeing while the gettin is good!

RJ Baxter on Twitter

Mortgage Rates in Denver Colorado by RJ Baxter 5-24-2010

Mortgage Rates have dropped again to all-time lows.  Hard to believe, but true, 30 year fixed Mortgage Rates are now well below the 5% mark.

Why is this happening?  In the wake of the end of the Feds MBS Purchase Program, it's hard to fathom how or why Mortgage Rates could fall so far.   As I wrote about last week, the reason is simply fear.

Traders are fearful of what the world economy is doing as news of the crisis in Europe continues to unfold.  This has led to a lot of uncertainty in the markets and a flight to safety as investors have flocked to safer investments such as bonds.

However, economic data continues to come out showing signs of a recovering economy.  Housing data was released today with sales up 7.6% in April.  However, investors and economists are watching with a leery eye as the effects of the tax credit will be wearing off soon.

All of this certainty has led to an extremely high VIX index.  The VIX is a measure of market volatility and sits at the highest level since the Lehman Brother crisis of 2008.  The VIX has also been called the "fear index" and is a sign that tension is at a very high level.  Mortgage Rates have been fluctuating daily and throughout the course of each day with all of the volatility.

For the time being, Mortgage Rates are incredible and it's impossible to know how many more times an opportunity like this will present itself.  30 year fixed rates at 4.75% with no points are hard to pass up.

VA Refinance with No Appraisal and No Closing Costs 4.75% 30 year fixed 

RJ Baxter First Mortgage Corp Evergreen Colorado Mortgage Market Update

My weekly Mortgage Market Update has been published here:  RJ Baxter First Mortgage Corp

Here are the Mortgage Market Update highlights:

GDP:  Best reading in 6 years at 5.9% growth in 4Q 2009.  However, when looking below the surface, the growth came mainly from restocking of inventories, not from consumer spending, which was down sharply.  This is not a good sign for the economy.

Home Sales:  Down again last month and below expectations after peak in Nov 2009.  Weather has surely played a factor, but this does not exactly signal a rebound in housing right now.

This Week:  Plenty of news in store for the week, and we start out with a bang today with the PCE inflation reading.  This will likely have an effect on rates.  Remember, high inflation has a negative effect on rates, eroding the value of a long term investment such as bonds that back fixed mortgages.  Therefore, when high inflation readings come in, rates go up.  The markets have been watching closely for signs inflation is coming as this is a big fear with all of the government stimulus money being spent.

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