Mortgage Rates have stabilized this week after moving & testing higher on the first 2 days of the week. Rates managed to improve modestly despite some volatility surrounding a scheduled auction of 30yr Treasury bonds on Thursday. Mortgage rates are based primarily on mortgage-backed-securities or MBS (bonds that tend to correlate with US Treasuries). As such, drama in Treasuries often spills over to mortgage rates.

Fortunately, Treasury traders were able to take today’s weak auction results in stride. The bond market weakened temporarily, but quickly returned to the slightly stronger levels from morning hours. This allowed mortgage lenders to hold rate sheets steady at slightly lower levels than yesterday.

Either way, the movement is small, and the average borrower will be seeing the same “note rate” then or now. The difference in rates comes down to the upfront costs. These affect the “effective rate” by making the overall cost of financing slightly higher.

Bottom Line: Due to market volatility and Fed Tapering, I am recommending client LOCK when escrow opens.

About the Author

Tim Morissette, also known in the community as Mr. Foothill Ranch, offers over 46 years of real estate experience which has given him an established reputation and unmatched market knowledge. He is joined by his wife, Michele and sons Matt and Jeff, as they continue to offer personal service with an emphasis on achieving his clients’ real estate goals.  This unique combination of traits has led to his proven track record of referral and repeat business. This can be witnessed by the trust of homeowners in Foothill Ranch where he has sold twice as many homes and represented three times more buyers than the next-leading real estate agent for the last 26 years.

As residents of Foothill Ranch since 1994, Tim and Michele are actively involved in the community by fundraising for Foothill Ranch Library, Make-a-Wish Foundation, Cancer Society, Homes for Habitat, Relay for Life, South County Outreach, and the local church and schools. Tim enjoys sponsoring community-wide garage sales, paper shredding and e-waste recycling event, an Easter egg hunt, & a Meet Santa Event.

Tim and Michele are dedicated to their family of four sons, daughter-in-laws, and grandchildren. As a family, they enjoy many outdoor activities which include camping, spearfishing, mountain climbing and exploring the miles of hiking and equestrian trails in Foothill Ranch and the Whiting Ranch Wilderness Park. Tim and his sons are also avid snowboarders and enjoy mountain biking and lobster diving. Family is a top priority in the Morissette household. They look forward to helping more families achieve their dreams of homeownership.