Today's Mortgage Market Update

Today’s Market Update- Tuesday May 19th, 2009 11:33 am ET

Current Trend Direction: Sideways

Risks favor: Floating as prices bounce off 100-day Moving Average

Current Price of FNMA 4.00% Bond- 99.81 -6bp

30 Year Fixed Rates
4.25% APR 4.44%

30-Year Jumbo Fixed Rates
5.125% APR 5.23%

5/1 Jumbo Arm
4.50% APR 4.61%

7/1 Jumbo Arm
4.75% APR 4.70%


Bond prices fell yesterday as stocks roared higher. The decline in Bond prices were halted by 100-day Moving Average floor of support and is where it is trading at the moment.
Remember, a strong stock market is bad for bond prices and mortgage rates.

Housing starts fell 12.8% to a seasonally adjusted rate of 458,000 units, well below expectations of 520,000 and the lowest on record since January of 1959.
Building permits also fell to a record low of 494,000 units, down 3.3% from March. Fewer homes being built can help to burn of existing inventory.


The credit markets are seeing improvement and banks are continuing to rebuild confidence in each other, with the LIBOR at .75% today, the lowest on record and a far cry from the 4.81% seen back in October.
JP Morgan, Morgan Stanley and Goldman Sachs have applied to repay up to a combined $45 Billion in TARP money.

We will continue to float rates here as we rest above the 100 day moving average. However, a break below the 100- day MA would not be good for mortgage rates.