MBS RECAP: Bond Rout Continues With No Help From Month-End

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MBS RECAP: Bond Rout Continues With No Help From Month-End

Posted to: MBS Commentary
Friday, June 30, 2017 4:53 PM

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There is month-end bond buying and then there is month-end “position-squaring.” These are 2 different things. Month-end bond-buying refers specifically to the phenomenon of money managers adjusting their holdings to match a specific bond market index. In general, there’s always a need to add to bond holdings because there’s always a certain amount that will be maturing in any given month. That’s why another name for month-end buying is “index extensions” (because average duration of any given set of bond holdings must be re-stretched or “extended” every month,…

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Daily Newsletter: Worst Week For Rates Since March, and a Counterpoint; Does Refi Advertising Help or Hurt?

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30 Year Fixed
4.07% +0.01
15 Year Fixed
3.32% +0.01
10YR Treasury
2.30% +0.0353
FNMA 30YR 3.5
102.66 -0.22
FNMA 15YR 2.5
102.59 -0.13
View Today’s Rates
Friday June 30, 2017
Mortgage Rate Watch – 3:43PM
Worst Week For Mortgage Rates Since March
Mortgage rates moved higher for a 4th straight day to end the month of June. In terms of upward movement, this has been the worst week for mortgage rates since early March, 2017. Most …
MND NewsWire – 3:07PM
A Counterpoint For Recent Move Higher in Bond Yields
The yield on the 10-year Treasury note hit its highest level in a little over month in Friday trading. But some strategists say bond yields edging up is not an indication that economic …
MND NewsWire – 1:02PM
Does Refi Advertising Help or Hurt Borrowers and Lenders?
“Mortgage borrowers frequently make costly refinancing mistakes by either refinancing when they should wait, or by waiting when they should refinance.” That is the working premise of …
Pipeline Press – 9:20AM
Fannie and Freddie Conventional Conforming Changes Across Multiple Lenders
Huh? The year is half over? Didn’t 2017 just start? Time has a way of flying by. Via rocket ship. July starts tomorrow… and we hear of a new marketing idea. SoFi is offering …

Latest Video


Will markets rally or correct in the second half?

Consumer sentiment index at 95.1 vs. 94.4 estimate

Personal income up 0.4% in May

More News from ‘Around the Web’

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Today’s Rates

Best Execution hdr_arrow.png
Rate Change
Current Mortgage Rates »
What are best-execution rates?
30 Yr FRM 4.07% +0.01
15 Yr FRM 3.32% +0.01
FHA 30 Year Fixed 3.75% +0.00
Jumbo 30 Year Fixed 4.33% +0.02
5/1 Yr ARM 3.16% +0.01

Average Mortgage Rates

Rate Points Change
FHFA * hdr_arrow.png
15 Yr. Fixed 3.06% 1.30 +0.03
30 Yr. Fixed 3.76% 1.38 +0.03
MBA ** hdr_arrow.png
30 Yr. Fixed 4.13% 0.32 +0.00
15 Yr. Fixed 3.39% 0.33 -0.01
30 Yr. Jumbo 4.09% 0.20 +0.01
30 Yr. FHA 4.02% 0.41 -0.02
5/1 ARM 3.31% 0.25 +0.05
Freddie Mac ** hdr_arrow.png
Current Mortgage Rates »
* FHFA averages are updated monthly.
** Mortgage Bankers Association (each Wednesday) and Freddie Mac (each Thursday) averages are updated weekly.
30 Yr. Fixed 3.88% 0.50 -0.02
15 Yr. Fixed 3.17% 0.50 +0.00
1 Yr. ARM 2.68% 0.20 +0.01
5/1 Yr. ARM 3.17% 0.50 +0.03

Secondary Markets

MBS hdr_arrow.png
Price Change
30YR FNMA 3.0 99.83 -0.30
30YR FNMA 3.5 102.66 -0.22
30YR GNMA 3.0 100.97 -0.44
30YR GNMA 3.5 103.52 -0.34
15YR FNMA 3.0 102.59 -0.13
15YR FNMA 2.5 100.42 -0.20
Treasuries hdr_arrow.png
Yield Change
Current MBS / Treasury Prices »
MBS and Treasury data provided by Thomson Reuters.
Mortgage News Daily and MBS Live! are exclusive re-distributors of Real Time Thomson Reuters Mortgage Information.
Secondary Marketing Managers:
If you are interested in gaining access to the most accurate real-time back-month TBA indications from Thomson Reuters and Tradeweb. Request More Information
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2 YR 1.3856% +0.0124
5 YR 1.8867% +0.0365
10 YR 2.3019% +0.0353
30 YR 2.8332% +0.0190
Prices as of: 6/30/2017 4:26PM EST

23623981

This information is not an advertisement to extend consumer credit as defined by Section 226.2 of Regulation Z. This is not an offer to enter into an agreement regarding interest rates. The rates quoted do not include discount points, origination points, or loan level risk based price adjustments. Rates and terms are subject to change without notice.
© 2017 Brown House Media, Inc. All rights reserved.
Brown House Media Inc. – 19706 One Norman Blvd – Cornelius, NC 28031
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Weekly Newsletter: “Lopsided Conditions” Hit Sales; Bad Week for Rates; GSE Drama; Price Gains Slowing?

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30 Year Fixed
4.07% +0.01
15 Year Fixed
3.32% +0.01
10YR Treasury
2.30% +0.0353
FNMA 30YR 3.5
102.66 -0.22
FNMA 15YR 2.5
102.59 -0.13
View Today’s Rates
Friday June 30, 2017
MND NewsWire – 6/28
"Lopsided Conditions" Dragging Down Pending Home Sales
Pending home sales failed to rise as expected in May, the third straight month that measure has declined. The National Association of Realtors’® (NAR’s) Pending Home Sale Index …
Mortgage Rate Watch – 6/30
Worst Week For Mortgage Rates Since March
Mortgage rates moved higher for a 4th straight day to end the month of June. In terms of upward movement, this has been the worst week for mortgage rates since early March, 2017. Most …
MND NewsWire – 6/27
Signs of Deceleration Despite Record High Home Price Index – Case-Shiller
The S&P CoreLogic Case-Shiller National Home Price Index for April set a record high , on a non-seasonally adjusted (NSA) basis for the fifth consecutive month. Some of the Case …
MND NewsWire – 6/27
Curtain May be Rising on Another GSE Drama
Bloomberg is reporting there appears to be yet another plan in the long running reality show featuring the government sponsored enterprises or GSEs. Fannie Mae and Freddie Mac, which …

Latest Video


Is the bond market showing warning signs?

Santelli Exchange: Is the U.S. 10-year establishing a new range?

Housing inventory has gotten worse as demand rises

More News from ‘Around the Web’

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Today’s Rates

Best Execution hdr_arrow.png
Rate Change
Current Mortgage Rates »
What are best-execution rates?
30 Yr FRM 4.07% +0.01
15 Yr FRM 3.32% +0.01
FHA 30 Year Fixed 3.75% +0.00
Jumbo 30 Year Fixed 4.33% +0.02
5/1 Yr ARM 3.16% +0.01

Average Mortgage Rates

Rate Points Change
FHFA * hdr_arrow.png
15 Yr. Fixed 3.06% 1.30 +0.03
30 Yr. Fixed 3.76% 1.38 +0.03
MBA ** hdr_arrow.png
30 Yr. Fixed 4.13% 0.32 +0.00
15 Yr. Fixed 3.39% 0.33 -0.01
30 Yr. Jumbo 4.09% 0.20 +0.01
30 Yr. FHA 4.02% 0.41 -0.02
5/1 ARM 3.31% 0.25 +0.05
Freddie Mac ** hdr_arrow.png
Current Mortgage Rates »
* FHFA averages are updated monthly.
** Mortgage Bankers Association (each Wednesday) and Freddie Mac (each Thursday) averages are updated weekly.
30 Yr. Fixed 3.88% 0.50 -0.02
15 Yr. Fixed 3.17% 0.50 +0.00
1 Yr. ARM 2.68% 0.20 +0.01
5/1 Yr. ARM 3.17% 0.50 +0.03

Secondary Markets

MBS hdr_arrow.png
Price Change
30YR FNMA 3.0 99.84 -0.28
30YR FNMA 3.5 102.66 -0.22
30YR GNMA 3.0 100.97 -0.44
30YR GNMA 3.5 103.52 -0.34
15YR FNMA 3.0 102.59 -0.13
15YR FNMA 2.5 100.42 -0.20
Treasuries hdr_arrow.png
Yield Change
Current MBS / Treasury Prices »
MBS and Treasury data provided by Thomson Reuters.
Mortgage News Daily and MBS Live! are exclusive re-distributors of Real Time Thomson Reuters Mortgage Information.
Secondary Marketing Managers:
If you are interested in gaining access to the most accurate real-time back-month TBA indications from Thomson Reuters and Tradeweb. Request More Information
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2 YR 1.3856% +0.0124
5 YR 1.8867% +0.0365
10 YR 2.3019% +0.0353
30 YR 2.8340% +0.0198
Prices as of: 6/30/2017 4:36PM EST

23623981

This information is not an advertisement to extend consumer credit as defined by Section 226.2 of Regulation Z. This is not an offer to enter into an agreement regarding interest rates. The rates quoted do not include discount points, origination points, or loan level risk based price adjustments. Rates and terms are subject to change without notice.
© 2017 Brown House Media, Inc. All rights reserved.
Brown House Media Inc. – 19706 One Norman Blvd – Cornelius, NC 28031
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Weekly Rate Report: Mortgage Rates Appreciably Higher

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weeklyrateheader.png
30 Year Fixed
4.07% +0.01
15 Year Fixed
3.32% +0.01
10YR Treasury
2.30% +0.0353
FNMA 30YR 3.5
102.66 -0.22
FNMA 15YR 2.5
102.59 -0.13
View Today’s Rates
Mortgage Rates Appreciably Higher
June 30, 2017
Market Summary
Mortgage rates moved appreciably higher from Tuesday through Friday. In terms of upward movement, this has been the worst week for mortgage rates since early March, 2017. Most borrowers are now seeing rates that are a full eighth of a point higher than Monday morning’s levels. While that’s not even remotely close to the damage done during election week last year, an eighth of a point in 4 days is definitely on the abrupt side of historical averages.

Whereas lenders had been quoting conventional 30yr fixed rates in a range between 3.875% and 4.0% on Monday morning (on top tier scenarios), that range is now up to 4.0-4.125%.

Just as we respected the previous trend toward lower rates until it was broken, so too should this new trend toward higher rates be respected until broken. That means erring on the side of locking vs floating, and simply understanding that rates could continue higher depending on next week’s data and events.

Matthew Graham, Chief of Operations, Mortgage News Daily

30 Year Fixed Rate Mortgage
30?w=360
Week in Review
Rates shown below are based on the 30 Year Fixed Rate Mortgage

Beginning Average: 3.98%
Ending Average: 4.07%
Weekly Change: +0.09%
Yearly Change: +0.54%

Friday, June 23, 2017 : 3.98% (+0.00%)
Weeks like this are the reason that some mortgage rate analysis is only done once a week. There haven’t been any significant developments in financial markets–at least not as far as bonds (which dictate rates) have been concerned. And there certainly hasn’t been any significant movement in mortgage rates themselves. In fact, with the exception of a modest dip last Wednesday, mortgage rates have been essentially flat for the entire month of June.

More detail: “Rates Cap Impressively Sideways Week Near Long-Term Lows”

Monday, June 26, 2017 : 3.97% (-0.01%)
Mortgage rates were steady to slightly lower today, depending on the lender. Underlying financial markets continue moving in a narrow range–something that’s not uncommon for the first few weeks of the summer. It’s that market movement that can result in mortgage lenders issuing mid-day reprices. The more volatile and the bigger the moves, the more likely lenders are to reprice. Today saw zero reprices.

More detail: “Rates Still Flat at 8-Month Lows”

Tuesday, June 27, 2017 : 4.00% (+0.03%)
Mortgage rates saw their biggest bounce higher in more than a week today as domestic bond markets (which dictate rates) followed a much bigger move in European bond markets. The European move can be traced to comments from European Central Bank President Mario Draghi depending on the lender. In a nutshell, his comments sounded like the Fed’s comments in the early days of the “taper tantrum” in the US (a big jump in rates that occurred when the Fed signaled its intention to buy fewer bonds).

More detail: “Mortgage Rates Bounce Higher”

Wednesday, June 28, 2017 : 4.02% (+0.02%)
Mortgage rates moved moderately higher again today, as investors continued digesting the possibility of a “taper tantrum” in Europe. The US version of the taper tantrum occurred in 2013 when the Fed began signaling its intention to buy fewer bonds. Fed bond buying was a key motivation for the all-time low rates seen in 2012.

More detail: “Mortgage Rates Highest in More Than 2 Weeks”

Thursday, June 29, 2017 : 4.06% (+0.04%)
Mortgage rates are higher again today, with the average lender now back to levels not seen since May 16th, 2017. Unless you’ve been following every little day-to-day change in rates, the apparent drama over the past few days is laughable. In the worst cases, some borrowers are now seeing rate quotes that are an eighth of percentage point higher than those seen on Monday morning. This comes out to $14/month for every $200k financed, but it can be more than a thousand dollars in terms of upfront costs on the same loan amount.

More detail: “Mortgage Rates Highest in More Than a Month”

Friday, June 30, 2017 : 4.07% (+0.01%)
Mortgage rates moved higher for a 4th straight day to end the month of June. In terms of upward movement, this has been the worst week for mortgage rates since early March, 2017. Most borrowers are now seeing rates that are a full eighth of a point higher than Monday morning’s levels. While that’s not even remotely close to the damage done during election week last year, an eighth of a point in 4 days is definitely on the abrupt side of historical averages.

More detail: “Worst Week For Mortgage Rates Since March”

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Today’s Rates

Best Execution hdr_arrow.png
Rate Change
Current Mortgage Rates »
What are best-execution rates?
30 Yr FRM 4.07% +0.01
15 Yr FRM 3.32% +0.01
FHA 30 Year Fixed 3.75% +0.00
Jumbo 30 Year Fixed 4.33% +0.02
5/1 Yr ARM 3.16% +0.01

Average Mortgage Rates

Rate Points Change
FHFA * hdr_arrow.png
15 Yr. Fixed 3.06% 1.30 +0.03
30 Yr. Fixed 3.76% 1.38 +0.03
MBA ** hdr_arrow.png
30 Yr. Fixed 4.13% 0.32 +0.00
15 Yr. Fixed 3.39% 0.33 -0.01
30 Yr. Jumbo 4.09% 0.20 +0.01
30 Yr. FHA 4.02% 0.41 -0.02
5/1 ARM 3.31% 0.25 +0.05
Freddie Mac ** hdr_arrow.png
Current Mortgage Rates »
* FHFA averages are updated monthly.
** Mortgage Bankers Association (each Wednesday) and Freddie Mac (each Thursday) averages are updated weekly.
30 Yr. Fixed 3.88% 0.50 -0.02
15 Yr. Fixed 3.17% 0.50 +0.00
1 Yr. ARM 2.68% 0.20 +0.01
5/1 Yr. ARM 3.17% 0.50 +0.03

Secondary Markets

MBS hdr_arrow.png
Price Change
30YR FNMA 3.0 99.84 -0.28
30YR FNMA 3.5 102.66 -0.22
30YR GNMA 3.0 100.97 -0.44
30YR GNMA 3.5 103.52 -0.34
15YR FNMA 3.0 102.59 -0.13
15YR FNMA 2.5 100.42 -0.20
Treasuries hdr_arrow.png
Yield Change
Current MBS / Treasury Prices »
MBS and Treasury data provided by Thomson Reuters.
Mortgage News Daily and MBS Live! are exclusive re-distributors of Real Time Thomson Reuters Mortgage Information.
Secondary Marketing Managers:
If you are interested in gaining access to the most accurate real-time back-month TBA indications from Thomson Reuters and Tradeweb. Request More Information
2 YR 1.3856% +0.0124
5 YR 1.8867% +0.0365
10 YR 2.3019% +0.0353
30 YR 2.8332% +0.0190
Prices as of: 6/30/2017 4:32PM EST

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This information is not an advertisement to extend consumer credit as defined by Section 226.2 of Regulation Z. This is not an offer to enter into an agreement regarding interest rates. The rates quoted do not include discount points, origination points, or loan level risk based price adjustments. Rates presented in this report are averages and are subject to change without notice.

© 2017 Brown House Media, Inc. All rights reserved.
Brown House Media Inc. – 19706 One Norman Blvd – Cornelius, NC 28031

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Daily Rate Update: Worst Week For Mortgage Rates Since March

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dailyrateheader.png
30 Year Fixed
4.07% +0.01
15 Year Fixed
3.32% +0.01
10YR Treasury
2.30% +0.0335
FNMA 30YR 3.5
102.67 -0.20
FNMA 15YR 2.5
102.55 -0.17
View Today’s Rates
Worst Week For Mortgage Rates Since March
June 30, 2017
Mortgage rates moved higher for a 4th straight day to end the month of June. In terms of upward movement, this has been the worst week for mortgage rates since early March, 2017. Most borrowers are now seeing rates that are a full eighth of a point higher than Monday morning’s levels. While that’s not even remotely close to the damage done during election week last year, an eighth of a point in 4 days is definitely on the abrupt side of historical averages.

Whereas 3.875% had been widely available on Monday morning, the most prevalently-quoted conventional 30yr fixed rate is now up to 4.0% for top tier scenarios, and 4.125% is rapidly gaining market share.

Whereas the lock/float outlook had been calm and steady heading into this week, it quickly turned defensive as losses mounted. There are multiple justifications for the weakness ranging from European Central Bank “taper talk” to an overabundance of trading positions in favor of lower rates earlier in the week (which makes rates susceptible to the sort of correction we’re seeing now). Assume rates can continue higher until we see a definitive ceiling take shape. The earliest that could happen would be the end of next week. The last corrective uptrend in rates lasted 3.5 weeks.

Today’s Most Prevalent Rates

  • 30YR FIXED – 4.00-4.125%
  • FHA/VA – 3.75%
  • 15 YEAR FIXED – 3.25-3.375%
  • 5 YEAR ARMS – 2.75 – 3.25% depending on the lender


Ongoing Lock/Float Considerations

  • Investors were relatively convinced that the decades-long trend toward lower rates had been permanently reversed after Trump became president, but such a conclusion would require YEARS to truly confirm
  • Instead of continuing higher in 2017, rates instead formed a narrow, sideways range, and held inside until April. Investor perceptions are shifting such that fiscal reforms and other policy developments will need to live up to expectations in order to push rates higher. Geopolitical risks would also need to avoid flaring up (more than they already have)
  • For the first time since the election, we’re in a rate environment where you wouldn’t be crazy not to lock at every little opportunity/improvement. Until/unless it’s broken, the highest rates of early-2017 mark the ceiling, and we’re now waiting to see how much lower we can go from here.
  • Rates discussed refer to the most frequently-quoted, conforming, conventional 30yr fixed rate for top tier borrowers among average to well-priced lenders. The rates generally assume little-to-no origination or discount except as noted when applicable. Rates appearing on this page are “effective rates” that take day-to-day changes in upfront costs into consideration.

30 Year Fixed Rate Mortgage
30?w=360
15 Year Fixed Rate Mortgage
30?w=360&p=15YRFRM

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Today’s Rates

Best Execution hdr_arrow.png
Rate Change
Current Mortgage Rates »
What are best-execution rates?
30 Yr FRM 4.07% +0.01
15 Yr FRM 3.32% +0.01
FHA 30 Year Fixed 3.75% +0.00
Jumbo 30 Year Fixed 4.33% +0.02
5/1 Yr ARM 3.16% +0.01

Average Mortgage Rates

Rate Points Change
FHFA * hdr_arrow.png
15 Yr. Fixed 3.06% 1.30 +0.03
30 Yr. Fixed 3.76% 1.38 +0.03
MBA ** hdr_arrow.png
30 Yr. Fixed 4.13% 0.32 +0.00
15 Yr. Fixed 3.39% 0.33 -0.01
30 Yr. Jumbo 4.09% 0.20 +0.01
30 Yr. FHA 4.02% 0.41 -0.02
5/1 ARM 3.31% 0.25 +0.05
Freddie Mac ** hdr_arrow.png
Current Mortgage Rates »
* FHFA averages are updated monthly.
** Mortgage Bankers Association (each Wednesday) and Freddie Mac (each Thursday) averages are updated weekly.
30 Yr. Fixed 3.88% 0.50 -0.02
15 Yr. Fixed 3.17% 0.50 +0.00
1 Yr. ARM 2.68% 0.20 +0.01
5/1 Yr. ARM 3.17% 0.50 +0.03

Secondary Markets

MBS hdr_arrow.png
Price Change
30YR FNMA 3.0 99.83 -0.30
30YR FNMA 3.5 102.67 -0.20
30YR GNMA 3.0 100.97 -0.44
30YR GNMA 3.5 103.52 -0.34
15YR FNMA 3.0 102.55 -0.17
15YR FNMA 2.5 100.42 -0.20
Treasuries hdr_arrow.png
Yield Change
Current MBS / Treasury Prices »
MBS and Treasury data provided by Thomson Reuters.
Mortgage News Daily and MBS Live! are exclusive re-distributors of Real Time Thomson Reuters Mortgage Information.
Secondary Marketing Managers:
If you are interested in gaining access to the most accurate real-time back-month TBA indications from Thomson Reuters and Tradeweb. Request More Information
2 YR 1.3856% +0.0124
5 YR 1.8867% +0.0365
10 YR 2.3001% +0.0335
30 YR 2.8317% +0.0175
Prices as of: 6/30/2017 4:18PM EST

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About This Report
Mortgage News Daily is a trusted source of mortgage rate market data and analysis, with over 1 million readers each month. Unlike many rate surveys, our survey is conducted on a daily basis and is designed to bring you the most current and accurate rate data available. We use a proprietary formula to calculate averages based on best-execution rates from top lender’s rate sheets, also taking into account feedback from hundreds of mortgage market professionals around the country.
© 2017 Brown House Media, Inc. All rights reserved.
Brown House Media Inc. – 19706 One Norman Blvd – Cornelius, NC 28031
View this Report in your Web Browser | Forward to a Friend | Subscribe
This information is not an advertisement to extend consumer credit as defined by Section 226.2 of Regulation Z. This is not an offer to enter into an agreement regarding interest rates. The rates quoted do not include discount points, origination points, or loan level risk based price adjustments. Rates presented in this report are averages and are subject to change without notice.
You were sent this email because you opted to receive our weekly or daily email reports. Go here to manage your email preferences or here to unsubscribe from all email communications.

A Counterpoint For Recent Move Higher in Bond Yields

A Counterpoint For Recent Move Higher in Bond Yields

Posted to: MND NewsWire
Friday, June 30, 2017 2:52 PM

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The yield on the 10-year Treasury note hit its highest level in a little over month in Friday trading.

But some strategists say bond yields edging up is not an indication that economic growth is picking up substantially.

“The bond market has largely been telling us, ‘growth is mediocre at best,’ and the stock market has been saying, ‘buckle up, it’s going to be great.’ And it’s a little bit hard to imagine a scenario in which both those things are true,” said Max Wolff, market strategist at 55 Institutional, Thursday on CNBC’s “Power Lunch.”

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Does Refi Advertising Help or Hurt Borrowers and Lenders?

Does Refi Advertising Help or Hurt Borrowers and Lenders?

Posted to: MND NewsWire
Friday, June 30, 2017 10:17 AM

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“Mortgage borrowers frequently make costly refinancing mistakes by either refinancing when they should wait, or by waiting when they should refinance.” That is the working premise of a paper published as part of the Federal Reserve’s Finance and Economics Discussion Series.

The paper, by Serafin Grundl and You Suk Kim, is titled “Consumer Mistakes and Advertising: The Case of Mortgage Refinancing.” Consumers, the authors say, tend to make mistakes and companies engage in various activities that can encourage mistakes, exploiting the biases of consumers to sell them overpriced products or those they don’t need, or conversely prevent mistakes by encouraging beneficial actions. Policies that restrict or regulate advertising can help the consumer, but where firms have an incentive to help consumers recognize products they do need, such restrictions would be harmful.

(READ THE FULL POST)

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