Eastside Circle Area - Long Beach Real Estate-Long Beach Homes and Condos For Sale

Warren Buffett describes his investment philosophy as being fearful when everyone else is greedy and greedy when everyone is fearful. Today, fear abounds in the mortgage bonds market and that is driving mortgage rates higher.

Rampant fear is why I’m suggesting that borrowers float their mortgage rate. I had been advising borrowers to lock loans, until all hell broke loose, on March 6,2008. Investors are worried that the mortgage bonds they hold will be worthless. This market is a lot like the junk bond market of the late 80s. Those that panicked lost money; those that kept a cool head, profited.

Today a 30 year fixed rate loan is offered at 6.25%, up from 5.875%, and a 7 year ARM is at 6.125%, up from 4.875%.

Can you see how much panic there has been in less than a week?

I think the market will calm down and traders will pay attention to the economic figures. The Consumer Price Index is due out Friday and that should be the big market mover. Float your mortgage rates, for now. Keep alert and keep checking back.

Contact Brian Brady at (858)-777-9751 with questions or to apply for a mortgage.

Long Beach mortgage rates skyrocketed this week and are .5% higher than Monday. Two things have driven mortgage rates higher:

1- The threat of inflation is omnipresent in every economic report.
2- Two mortgage companies defaulted on their lines of credit.

Remember when I talked about how important it is to use a mortgage planner who subscribes to real-time MBS pricing?

Why am I so adamant about the fact that the ten-year treasury note is not the determining factor of mortgage rates? The statement is factually incorrect. While the two securities often move in concert, polarity can occur and sometimes does; this is one of those times. The ten-year T-note is considered the benchmark, not bellwether fixed-income security. This means that all other securities are compared to the 10-year T-note (we call that the