The economic seesaw brought mortgage rates down to new record lows last week.

Two weeks ago, mortgage rates flared higher thanks to a warmer set of economic data. Last week, that increase “was cut off at the knees” by a softer-than-expected fourth quarter GDP report and a Federal Reserve outlook that left a lot to be desired, explained Keith Gumbinger, vice president of HSH.com, in the latest Market Trends newsletter. Read the rest of this entry »

The world remains awash in troubles, including slowing growth and recession likely forming in Europe, less-stellar growth in China and a still-weak recovery here at home.

That being the case, and with fiscal policy flailing about both here and abroad, central banks announced both individual and coordinated actions to help address some of these issues, and stock investors cheered loudly at the efforts. A considerable rise in stocks last week came partly at the expense of bonds, and while underlying interest rates rose somewhat as a result, most mortgage rates didn’t follow them. Read the rest of this entry »

There were plenty of economic twists and turns last week which allowed mortgage rates to find some additional room to fall.

Fed and economy send rates downward

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Many market observers are expecting the Federal Reserve to announce a new form of economic policy this afternoon following their two-day FOMC meeting.

What type of economic policy? Well, that remains to be seen.

On Monday, we provided some analysis of a few possible strategies the Fed could announce today, but at the moment, most of us are expecting that the Fed will announce plans to “buy longer dated Treasury securities in a bid to hold down interest rates.”

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Last week, the Federal Reserve concluded their two-day meeting, acknowledging that the economy is moving even slower than they originally anticipated and that their latest program–dubbed “QE2″–would come to an end as originally designed by month’s end.

HSH.com releases Two-month forecast for mortgage rates

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One of the strangest new requirements coming out of Washington is that borrowers must actually have the ability to repay their mortgages.

At first this sounds entirely ridiculous because mortgage lenders would seem to have an obvious interest in getting repaid. Unfortunately, given no-doc loan applications and other short-cuts that lead to the mortgage meltdown, the sense in Washington is that baseline mortgage requirements must be spelled out in detail–otherwise lenders will bend or evade the rules.

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We all know that this economy has brought on hard times for millions of Americans. I think everyone agrees that this country’s economic woes won’t end until the housing market turns around. Amidst the still-anemic news of recovery are some bright spots, though.

If you’re a potential homebuyer, you have five big reasons to feel thankful this Thanksgiving:

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It was a combination of the Federal Reserve’s latest edition of their quantitative easing efforts and a slight upward trend of economic indicators which caused mortgage rates to rise last week.

“Some analysts have speculated that the market got a little ahead of itself in preparation for the beginning of the [Fed's] program, and has been forced to back off a little bit,” according to the latest issue of HSH.com’s Market Trends Newsletter: Read the rest of this entry »

New York Fed President Bill Dudley gave an interview recently with CNBC in which he defended some of the most common criticisms of the Fed’s QE2 program.

Criticism #1: Quantitative Easing will cause inflation: Read the rest of this entry »

I’ve said it before, the Federal Reserve has been the most successful government entity in providing any substantial form of stimulus or relief to our economy since the downturn began.

The Fed strikes again

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