How low can we go? 30 yr fixed at 3.75% with no fees...

[eomly]

All the rates that I quoted were for 0pts.  Jumbo rates are not as volatile as conforming rates as they don't move based upon MBS bond pricing hence why they are significantly lower than conforming rates today.

Yup, 30-year fixed jumbo loan is still 3.125%.

For primary residence? Which lender?

 

[CalBears96]

All the rates that I quoted were for 0pts.  Jumbo rates are not as volatile as conforming rates as they don't move based upon MBS bond pricing hence why they are significantly lower than conforming rates today.

Yup, 30-year fixed jumbo loan is still 3.125%.

For primary residence? Which lender?

Just to clarify, I'm working with Union Bank on a purchase, not refi, since it's preferred lender of Irvine Pacific.

A few posts earlier, someone recommended Sherry Wang from Citibank. Maybe you can check with her.

 

[usctrojancpa]

All the rates that I quoted were for 0pts.  Jumbo rates are not as volatile as conforming rates as they don't move based upon MBS bond pricing hence why they are significantly lower than conforming rates today.

Yup, 30-year fixed jumbo loan is still 3.125%.

For primary residence? Which lender?

US Bank, Wells, and BofA.

 

[Danimal]

All the rates that I quoted were for 0pts.  Jumbo rates are not as volatile as conforming rates as they don't move based upon MBS bond pricing hence why they are significantly lower than conforming rates today.

Yup, 30-year fixed jumbo loan is still 3.125%.

For primary residence? Which lender?

US Bank, Wells, and BofA.

BofA will offer .25% discount if borrower has $1 million in BofA account (cash for dow down payment or whatever) at the time the loan is signed.

 

[sleepy5136]

All the rates that I quoted were for 0pts.  Jumbo rates are not as volatile as conforming rates as they don't move based upon MBS bond pricing hence why they are significantly lower than conforming rates today.

Yup, 30-year fixed jumbo loan is still 3.125%.

For primary residence? Which lender?

US Bank, Wells, and BofA.

BofA will offer .25% discount if borrower has $1 million in BofA account (cash for dow down payment or whatever) at the time the loan is signed.

You might as well look into Citi then. 0.5% discount if you have 1m with them when closing.https://online.citi.com/US/JRS/portal/template.do?ID=relationship_pricing_landing

 

[Cares]

Is it $1M after closing? As in, if you use the funds for down payment then you don't get the discount?

 

[sgip]

These new to the bank assets are called "Relationship Funds" for a reason. The Banks want some "stickyness" to the accounts that open for a rate discount. Only Wells Fargo for a short time had allowances to use the funds for the down payment, but stopped that due to run off of the entire relationship shortly after the deed recorded.

Some banks will require a portion of the funds to be under management if stocks are being moved. A self directed Merrill Edge (for example) won't get the same mortgage rate discounts as would a fully managed Merrill account.

Chase, Wells, Citi, BofA, Union Bank (now part of USBank), and some of the brokerages like Morgan Stanley (via Rocket from what I can recall) all offer these discounts. First Republic has wider guidelines and some rate improvements when that kind of money is moved.

None of these accounts hold your money hostage post closing, but if the bigger mortgage rate reduction comes if funds are managed, it may be harder to move once you've moved in your new home.

For long term new construction buyers, I'd suggest moving as much as you can now into a Bank account. After sitting there for 60 days, discounts are applied. If you can move "non down payment" funds into an account at closing, more discounts are offered.

As a note some banks discount only their jumbo products, and lightly discount their conforming. Don't expect low rate bonuses if the loan balance is below $640k compared to what you find for a portfolio jumbo.

My .02c

 

[sleepy5136]

Is it $1M after closing? As in, if you use the funds for down payment then you don't get the discount?

You have to leave 1m in account and it cannot be used towards closing funds. But you can take all that money out after closing.

 

[Cares]

2 and 10 year yield spread is now only 40 bps. It was about 160 bps earlier last year. I'm think we will see an inverted yield curve sometime this year which has typically been an indicator of recession.

 

[Liar Loan]

Now the new question for this thread is how high can we go?

30 year fixed up to 4.5 - 4.75 in 2023?

Not gonna happen.  We might top out around 4% +/- a bit before heading back down.

It only took a month to hit 4% rates and the Fed hasn't even taken significant action yet.  Consumer inflation is still rising and now sits at 7.5%.

Care to revise your prediction?

Rates are not 4% yet with the lenders that I refer to my buyers...they were around 3.625% earlier this week but I'm sure after today it's around 3.75%. That's for conforming rates.  Jumbo rates were around 3.125-3.25% earlier this week. Can they go higher?  Sure but they'll only go up so high.

I want more inventory and less bidding, I have a ton of frustrated buyers ready to buy but keep getting outbid because there are 15-30 offers on each month that we put on an offer on.

Do you think the Federal Reserve will be checking in with your lenders or with nationally recognized sources of mortgage news?  Also, it's not clear if you are quoting zero points or not.  The average for all lenders with zero points is 4.05%... and climbing.

Mortgage Rates Hit 4.0% For First Time Since May 2019

For decades, the most prevalently-quoted source has been Freddie Mac's weekly primary mortgage market survey.

Freddie's survey showed an increase from 3.55 last week to 3.69 this week.  This assumes a best case scenario 30yr fixed with 0.8 points paid upfront.  I don't love the idea of building points into rate indices if points can change over time.  I'd rather just adjust the rates to reflect the points since there's reliable math for that purpose.

For example, at most lenders right now, you'd pay 1 point to drop the rate by 0.25%.  If Freddie made that adjustment, their 3.69 would rise to 3.89.  But remember, that would have applied to Monday/Tuesday based on Freddie's methodology.

In case it wasn't already clear based on the headline, the average is currently up to 4.02% (4.05% as of Friday).  Keep in mind that is is an average among top tier scenarios.  Adding any complexity to the scenario would mean a different rate.
https://www.mortgagenewsdaily.com/markets/mortgage-rates-02102022

All the rates that I quoted were for 0pts.  Jumbo rates are not as volatile as conforming rates as they don't move based upon MBS bond pricing hence why they are significantly lower than conforming rates today.

I'm aware of the difference in jumbo pricing, but this is shifting the goal posts.  Your original comment was in response to Inc's question of "how high will we go?" and rates hit 4% one month to the day from that comment.  There are always some products priced cheaper, but the 30Yr conforming rate is the gold standard when quoting rates.  The title of this thread is also in reference to conforming rates with no fees.

The taper of MBS purchases has hit conforming rates pretty hard.  Jumbo rates are priced by portfolio lenders (mostly large banks) and aren't subject to the whims of the MBS / bond markets.  Hence, the taper won't affect jumbo rates directly, but the upcoming increases in the Fed Funds rate, which does affect bank balance sheets directly, should start to affect jumbo rates later this year.

 

[usctrojancpa]

Now the new question for this thread is how high can we go?

30 year fixed up to 4.5 - 4.75 in 2023?

Not gonna happen.  We might top out around 4% +/- a bit before heading back down.

It only took a month to hit 4% rates and the Fed hasn't even taken significant action yet.  Consumer inflation is still rising and now sits at 7.5%.

Care to revise your prediction?

Rates are not 4% yet with the lenders that I refer to my buyers...they were around 3.625% earlier this week but I'm sure after today it's around 3.75%. That's for conforming rates.  Jumbo rates were around 3.125-3.25% earlier this week. Can they go higher?  Sure but they'll only go up so high.

I want more inventory and less bidding, I have a ton of frustrated buyers ready to buy but keep getting outbid because there are 15-30 offers on each month that we put on an offer on.

Do you think the Federal Reserve will be checking in with your lenders or with nationally recognized sources of mortgage news?  Also, it's not clear if you are quoting zero points or not.  The average for all lenders with zero points is 4.05%... and climbing.

Mortgage Rates Hit 4.0% For First Time Since May 2019

For decades, the most prevalently-quoted source has been Freddie Mac's weekly primary mortgage market survey.

Freddie's survey showed an increase from 3.55 last week to 3.69 this week.  This assumes a best case scenario 30yr fixed with 0.8 points paid upfront.  I don't love the idea of building points into rate indices if points can change over time.  I'd rather just adjust the rates to reflect the points since there's reliable math for that purpose.

For example, at most lenders right now, you'd pay 1 point to drop the rate by 0.25%.  If Freddie made that adjustment, their 3.69 would rise to 3.89.  But remember, that would have applied to Monday/Tuesday based on Freddie's methodology.

In case it wasn't already clear based on the headline, the average is currently up to 4.02% (4.05% as of Friday).  Keep in mind that is is an average among top tier scenarios.  Adding any complexity to the scenario would mean a different rate.
https://www.mortgagenewsdaily.com/markets/mortgage-rates-02102022

All the rates that I quoted were for 0pts.  Jumbo rates are not as volatile as conforming rates as they don't move based upon MBS bond pricing hence why they are significantly lower than conforming rates today.

I'm aware of the difference in jumbo pricing, but this is shifting the goal posts.  Your original comment was in response to Inc's question of "how high will we go?" and rates hit 4% one month to the day from that comment.  There are always some products priced cheaper, but the 30Yr conforming rate is the gold standard when quoting rates.  The title of this thread is also in reference to conforming rates with no fees.

The taper of MBS purchases has hit conforming rates pretty hard.  Jumbo rates are priced by portfolio lenders (mostly large banks) and aren't subject to the whims of the MBS / bond markets.  Hence, the taper won't affect jumbo rates directly, but the upcoming increases in the Fed Funds rate, which does affect bank balance sheets directly, should start to affect jumbo rates later this year.

Ok rates are around 4% for confirming loans but here in Irvine and the surrounding areas, a lender can portfolio high balance conforming loans not just jumbo loans to bring the rates back into the low-to-mid 3% so it's not black and white.  That being said, a few of my low-end buyers are getting prices out and going onto the sidelines because the higher prices and higher rates but we are talking clients that can't go above $1m.  So instead of seeing 25-40 offers on these lower end homes, there will be 15-20 offers.  Again, I welcome prices leveling off and more inventory coming because a balanced market is better for everyone and where a good buyer/listing agent can really shine.

 

[daedalus]

So basically rates are back to where they were 10 years ago when this thread was started.

 

[Hugo Township]

So basically rates are back to where they were 10 years ago when this thread was started.

It's almost like a cycle.

 

[OCtoSV]

and for most of us what a life changing 10 years it's been - like the raging after party of the financial repression regime. But times have changed - my biggest percentage winners now over the prior 12 months are XOM, BAC, CVX - 103/95/82%.

 

[Liar Loan]

So basically rates are back to where they were 10 years ago when this thread was started.

It's almost like a cycle.

I don't know... A cycle implies a natural phenomenon.  When human beings are making subjective decisions about how many mortgage-backed securities the Fed should hold on its balance sheet, mortgage rates are not really a result of any economic cycle.  Quantitative easing has been with us for 13+ years now.

 

[sgip]

Gigantic reversal in mortgage rates today.  If you didn't lock already, it may be a couple of days to see another return back to the lows of Monday/Tuesday this week.

 

[CalBears96]

Gigantic reversal in mortgage rates today.  If you didn't lock already, it may be a couple of days to see another return back to the lows of Monday/Tuesday this week.

It's too bad I missed out on yesterday's low to lock.

 

[sgip]

There's still plenty of movement to occur in your favor ahead. One example - as soon as the Fed raises the rates they control, we will see mortgage rates fall. It's counter-intuitive, but concrete action on inflation is good for mortgage bonds.

My .02c

 

[Cares]

Gigantic reversal in mortgage rates today.  If you didn't lock already, it may be a couple of days to see another return back to the lows of Monday/Tuesday this week.

Been a long time since we've seen 100 bps movement in a day...

 

[Liar Loan]

Gigantic reversal in mortgage rates today.  If you didn't lock already, it may be a couple of days to see another return back to the lows of Monday/Tuesday this week.

It's too bad I missed out on yesterday's low to lock.

Sorry, but yesterday was not the low... not by a long shot.  Monthly mortgage costs are now the highest in history - Higher than the 2007 price bubble.  tic, tic, tic...

American Mortgage Payment Costs Are Now 36% Higher Than a Year Ago

Finding a home to buy is only the first struggle. Then there?s paying the mortgage.

That?s become increasingly challenging, with the average American monthly mortgage payment rising to the highest level ever. It?s now $1,230 per month for a 30-year, fixed-rate loan, according to data from home-listing site Zillow. That?s up 36% from the average of $905 a year ago and a 6% increase from January.

In the past year, the typical U.S. home increased almost 20% in value, from about $272,000 to $326,000. Although mortgage rates only inched higher for most of 2021, that uptick combined with rapid home-price appreciation to push the average monthly mortgage payment to a record high.
https://www.bloomberg.com/news/arti...ent-monthly-cost-hits-record-for-30-year-loan