What’s Ahead For Dublin, CA Mortgage Rates This Week : February 28, 2011

Employment data is released FridayMortgage markets improved last week as Wall Street’s concerns about the Middle East trumped its fears of inflation. Conforming interest rates and FHA mortgage rates in Dublin as well as California fell to a 3-week low.

Last Week:

Last week marked the second straight week in which mortgage rates fell, a streak that follows four straight weeks of climbing mortgage rates.

It’s been a bout of good fortune for rate shoppers and home buyers in the Bay Area.

In addition, according to Freddie Mac’s weekly mortgage rate survey, the average spread between conforming 30-year fixed rate mortgages and 5-year ARMs has widened further.

Interest Rate Gaps and Buy downs Widen

The two benchmark products are now separated by 1.15%. It’s the largest interest rate gap in recent history; one that yields a monthly payment difference of $68 per $100,000 borrowed.

This week, it’s unclear in what direction mortgage rates will go.

On one side, there’s ongoing unease related to protests in Libya and its neighbors, and that’s driving safe haven buying.

“Safe haven buying” describes when investors flee risky situations and put their money in the safest places possible. Mortgage bonds are one such place, so when safe haven buying is in effect, bond demand is high so bond yields (i.e. mortgage rates) fall.

On the other side, inflation is ramping up.

Recent economic data shows that the economy is expanding, and the Federal Reserve is maintaining its accommodative growth policies. Therefore, this week, the key economic event will be Friday’s jobs report. if job creation is high, expect inflation fear to re-ignite, and mortgage rates to rise.

Another risk factor for this week’s rate shoppers is that tensions begin to settle in the Middle East, or that Wall Street gets more comfortable with rising oil prices. If that happens, safe haven buying will subside and mortgage rates will resume rising.

Plan Ahead

With the Spring home buying season ahead of us in Dublin there appears to be more reasons for mortgage rates to rise this week and in the future than for them to fall. Plan accordingly.

If you have not started the pre approval process for you home purchase, this week may represent one of your last chance’s to get a low interest rate.  The first step is to send me a message below or give me a call. I personally reply to all my own messages. With the right guidance on your home purchase its sure to be a good experience.

Subscribe to our daily mortgage market emails.

Have a Question?

Legal Disclaimer
Or give us a call
925-484-5363