Colorado Home Loan Rates: Lock or Float?
Colorado Home Loan Rates appear to be moving in the right direction today. Pending home sales came in lower then expected which created some excitement in the Mortgage Backed Securities market. So far we have seen some improvements in Colorado Home Loan Rates, but not enough to indicate a price improvement. The good news is that Colorado Home Loan Rates will probably not have any increases on today’s headlines. We implemented a LOCK recommendation yesterday, and we will maintain the LOCK recommendation today.
This week will be a light week for economic data and it will not take much to send Colorado Home Loan Rates back up. Investors are anticipating more bad news circling around unemployment, which means Thursdays Jobless Claims, should have some impacts on Colorado Home Loan Rates later this week. Tomorrow we have no scheduled economic data to be released. The Lack of data will force investors to monitor the equities market before making their buy/sell decisions for MBS.
Ben Bernanke spoke in Virginia yesterday and he continued his tough talk about additional regulation in the mortgage lending markets. His comments indicated that the shady practices used by lenders over the last few years, has been the biggest influencer in our current economic downturn. He is proposing additional regulations on mortgage lenders to help improve the current performance of Mortgage Backed Securities. Ben will present his recommendations to a senate sub-committee for review sometime next week. Investors have not reacted negatively to the news and so far we have not seen any major impacts in the Colorado Home Loan markets. Reform is needed and lenders do need additional regulation, but to what extent still needs to be debated.
Colorado Home Loan Rates have always been impacted by risk. Underwriters are the banks authority when assessing risk. They are in charge of assessing what the risk is and whether the risk on the file should be considered for approval. Colorado Home Loan Rates are influenced by the entire mortgage portfolio and the history of that mortgage portfolio. In the past underwriters approved just about any Colorado Home Loan, which has drastically deteriorated the current performance of these mortgage portfolios. The result of loose lending practices has created a higher then normal risk premium being added to Colorado Home Loan Rates today. Today underwriters are taking a tougher approach in approving Colorado Home Loan programs, which should return better performing portfolio’s in the future. The risk on today’s loans is considerably lower then the risk premium being added to Colorado Home Loan Rates. We are still paying for mistakes made over the last few years, and will not see the risk premium reduced for some time. If the Federal Reserve implements additional restrictions and Colorado Home Loan Rates don’t improve, Lenders will ultimately reap the benefits in higher profit margins. This is ok but eventually the savings should be passed back in the form of lower Colorado Home Loan Rates.
I am hoping that Lenders recognize the spread between Risk and current Colorado Home Loan Rates, but so far it appears that the spread is still fairly large. In short you are paying more now because of the losses created by poor lending decisions 2 or 3 years ago. We will not see any significant changes in the risk premiums added to Colorado Home Loan Rates until the portfolios perform better over time. With all the restrictions currently put into place, we should see Colorado Home Loan Rates improve its risk premium over the next 12 to 18 months.
Though the portfolio will improve its performance, it should be noted, that we have many other factors influencing the direction Colorado Home Loan Rates will go. The biggest factor affecting Colorado Home Loan Rates is inflation. This topic has been discussed in great detail here, but I want to remind you that it will be the biggest driver of Colorado Home Loan Rates over the next 6 months. I have some real concerns about how much of an impact inflation will have and we have already begun to seen the impacts over the last 2 months. The impacts have not come from actual inflationary reports, but from speculation of what is to come. The real affect will be felt when economic reports begin to report the higher inflationary numbers. Colorado Home Loan Rates are certainly expected to go up from its current levels. We see some pockets of hope where Colorado Home Loan Rates drop or show some stability and that is the best time to LOCK. We are experiencing that in the market right now, and should for the remainder of the week. Next week on Tuesday and Wednesday, we will have our inflationary report numbers. So if you can get into a good Colorado Home Loan Rate today, then LOCKING is a good idea.
Over the Last couple of months our inflationary numbers have been in line. Most of that is not due to lower prices, but to lower spending. Eventually people will spend again and prices at its current levels will create higher then expected inflationary pressure. When this happens inflationary reports will come out high, which inevitably creates havoc on the Mortgage Backed Securities Market. Colorado Home Loan Rates hate anything to do with inflation and rates will go up. Next week if PPI or CPI comes in worse the expected, Colorado Home Loan Rates will climb. Stay tuned to this site daily as updates are made on a regular basis.
For your Colorado Home Loan decision it’s easy to find someone to help you, however it can be difficult to find someone who knows what they are talking about. Please allow me a chance to work with your Colorado Home Loan; I have the knowledge to get you the best Colorado Home Loan available. I have also written an interesting article about Brokers or Bankers at www.coloradohomemortgageloan.net/news let me know what you think.
Daniel
Tags: Colorado home, Colorado Home Loan Rates, Home Loan Rates, Loan Rates
