From Ted Gosnell at First Home Mortgage.
Mortgage rates are higher this week; with labor market and retail sales data better than expected, most investors have pretty much decided that the Fed will begin to taper its bond purchase program by September. Investor’s anticipation of the reduced Fed purchases has caused much volatility in the stock markets as well as an aggressive sell off in U.S. Treasuries. These increased U.S. Treasury sales have pushed 10 year Treasury yields to 2.85% and 30 year conventional fixed mortgage rates to 4.75% and higher. When the Fed’s tapering of bond and mortgage backed security purchases does actually begin; expect mortgage rates to push even higher and if investors are right, then those higher mortgage rates are less than 2 weeks away.
All that said, it would behoove buyers to commit and “sign the papers” before the Labor Day Weekend and those papers to be signed would also include their mortgage application!