Nashville Real Estate Forum

Weekend Market Update

June 6-7, 2009

Mortgage interest rates continued to trend higher on Friday, with most lenders raising their rate pricing twice intra-day. The 10-year Treasury note closed yielding 3.86%, its highest mark since early November, just before long-term mortgage rates dropped sharply. The 30-year bond closed yielding 4.66%, its highest yield since last July.

With money moving into stocks---and with new Federal debt issues competing with Treasuries and mortgage-backed securities for investors---there was only one way for mortgage rates to go.

The stock market is wanting to move higher and is looking at any news as a glass half full and an excuse for buying equities. Major stock indices closed higher for the third week in a row, but Friday's trading was choppy. The government reported about 345,000 jobs were lost in May---about half as many as were being eliminated earlier this year---but the unemployment rate rose to 9.4%, the highest in 25 years. Some market watchers took the report as a sign of an economy ready to turn the corner, going with a bad-but-getting-better scenario.

As we noted in last week's Market Update, we appear to have seen the lows in rates for homebuyers and home refinancers in this market cycle.

Anyone contemplating a purchase or refinance at this time should contact me right away to devise a strategy for getting the best possible rate pricing, so we can catch the market while still in its range of historical lows.

The Securities and Exchange Commission charged former Countrywide CEO Angelo Mozilo and the company's chief financial officer and chief operating officer with fraud for telling investors everything was hunky-dory at the mortgage behemoth while emailing among themselves that some of their 80/20 subprime products and their pay-option ARM were "toxic" and "dangerous." In a pay-option ARM, a borrower may pay less than the accrued monthly interest, thus creating negative amortization, or a loan balance that increases instead of going down. Mozilo was also charged with insider trading for unloading $140 million in Countrywide stock before it crashed. Here is a link to that story: http://www.economist.com/finance/displaystory.cfm?story_id=13805607

Countrywide no longer exists, having been swallowed by Bank of America for---gulp---$4.1 billion.

30-Year Conventional Fixed
5.375% $200,000-$417,000

FHA-100% VA
5.75% $100,000-$393,300

100% Guaranteed Rural Housing w/no MI

6% $100,000-$417,000

30-Year Jumbo 5/1 ARM (10% down, No MI)

5.2% $417,001-$900,000

(Interest-only available-Call me)

Call for free pre-approval and to discover

the best financing for you!

...by Gary Moore

Cell: 615-579-8658 Toll-free fax: 866-321-6513

"To keep a lamp burning we have to keep putting oil in it." - Mother Teresa

Visit my mortgage website:

http://www.BrentwoodHomeLoan.com

(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)