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MIG Market Watch, February 22nd, 2021

MIG Market Watch, February 22nd, 2021


MIG Market Watch, February 22nd, 2021

MARKET COMMENT
Mortgage bond prices finished the week sharply lower which put significant upward pressure on rates. Rates were worse Tuesday as inflation fears flared and that continued through most of the week. Many traders bet on rebounding growth which ultimately could be accompanied by inflation. Inflation, real or perceived, erodes the value of fixed income investments such as mortgage-backed securities. This cause prices to fall and rates to rise. The Fed minutes indicated, “Some participants further observed that 12-month PCE inflation was likely to move somewhat above 2 percent for a brief period in the spring as the unusually low monthly observations from last spring roll out of the 12-month calculation.” Producer prices rose 1.3% vs the expected 0.5% increase. The core, which excludes volatile food and energy prices, rose 1.2% vs the expected 0.2% increase. Mortgage interest rates finished the week worse by approximately 7/8 to one full discount point.

LOOKING AHEAD

Economic Indicator Release Date & Time Consensus Estimate Analysis
Leading Economic Indicators Monday, Feb. 22,
10:00 am, et
Up 0.3% Important. An indication of future economic activity. A smaller increase may lead to lower rates.
Consumer Confidence Tuesday, Feb. 23,
10:00 am, et
89.6 Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates.
New Home Sales Wednesday, Feb. 24,
10:00 am, et
855K Important. An indication of economic strength and credit demand. Weakness may lead to lower rates.
Weekly Jobless Claims Thursday, Feb. 25,
8:30 am, et
820K Important. An indication of employment. Higher claims may result in lower rates.
Durable Goods Orders Thursday, Feb. 25,
8:30 am, et
Up 1.2% Important. An indication of the demand for “big ticket” items. Weakness may lead to lower rates.
Q4 GDP Thursday, Feb. 25,
8:30 am, et
Up 3.7% Very important. The aggregate measure of US economic production. Weakness may lead to lower rates.
Personal Income and Outlays Friday, Feb. 26,
8:30 am, et
Up 4.3%,
Up 0.5%
Important. A measure of consumers’ ability to spend. Weakness may lead to lower mortgage rates.
PCE Core Inflation Friday, Feb. 26,
8:30 am, et
Up 0.1% Important. A measure of price increases for all domestic personal consumption. Weaker figure may help rates improve.
U of Michigan Consumer Sentiment Friday, Feb. 26,
10:00 am, et
79.2 Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates.

FED UNCERTAINTY
The Fed Monetary Policy Report released February 19, 2021 described a serious challenge the Fed faces. The Fed stated, “As with real activity and inflation, the outlook for the future path of the federal funds rate is subject to considerable uncertainty. This uncertainty arises primarily because each participant’s assessment of the appropriate stance of monetary policy depends importantly on the evolution of real activity and inflation over time. If economic conditions evolve in an unexpected manner, then assessments of the appropriate setting of the federal funds rate would change from that point forward.”

With so much uncertainty, now is a great time to take advantage of the historically low mortgage interest rates we currently have.

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Mortgage Investors Group, based in Tennessee, offers residential financing in a number of states in the southeast, See MIG Service Areas. Terms and conditions to apply to home financing. We want to share with you the loan terms vary based on several characteristics and your financial profile. These include but are not limited to loan program, loan purpose, occupancy, credit history, credit score, assets, and other criteria per loan type. The repayment terms and interest rate may vary from time to time. The terms represented here are based on certain assumptions outlined below and/or noted on the loan outline page. Additional details concerning privacy, program disclosures, licensing specifics may be found at migonline.com Legal Information.

MIG Loan Officers will help gather the information needed for an individual assessment to provide home financing which matches the loan characteristics with your home financing needs based on your financial profile, when you are ready to begin a full loan application. For estimates and general information before that step, the basis for which the mortgage financing information are as follows:

  • Rates are subject to change at any time.
  • Rate locks are available at current terms for 30 to 180 days based on program type, credit profile, property location, etc. which will affect the available rate and term.
  • Rate locks are available at current terms for 30 to 180 days based on program type, credit profile, property location, etc. which will affect the available rate and term.
  • Payments will vary based on program selection, current rates, property location, etc.
  • Not all programs are available in all states.
  • Some loan programs may not be available to first time home buyers.
  • Terms and conditions apply, which may include restrictions or limits per loan program.
  • Information is generally based on primary residence occupancy with no cash out when refinancing.
  • Unless otherwise stated, terms shown are estimates based in part on credit score of 700 or higher; owner occupancy, escrow account is established for taxes and insurance(s); debt-to-income ratio no higher than 43.0%; PMI applies to conventional loan programs over 80.0% LTV; VA,FHA & RD require insuring fees included in loan and/or payment; fixed rate, 30 year term.

An MIG Loan Officer is available to help with your financial details to determine which characteristics apply to your situation for a personalized look into which loan program best fits your home financing needs. Please use the Find a Loan Officer link or reach out to Mortgage Investors Group at 800-489-8910. Equal Housing Lender 1.2020