San Diego home buyers can take a breather. Our advice to lock rates at application these past two weeks was sound. Although treasury bond yields dropped, mortgage-backed securities yields rose in fear of more defaults. It was understanding this conundrum that prompted our lock advice.
Today, we think it is safe for a San Diego mortgage applicant to float their mortgage rate; there may be some room for improvement this week.
The liquidity crisis extends past our borders: A large British insurance company may have been forced to borrow from the Bank of England and a potential German banking crisis abounds.
Senator Dodd just met with Fed Chairman Bernanke. He queried whether the Fed was willing to use any and all available resources to avert a mortgage liquidity crisis and seemed satisfied with the Fed Chairman's response. That may have averted Congressional interference (we hope). Senator Dodd is continuing to petition the President to raise the statutory limits of conforming loans ($417,000) as an emergency measure. Californians would benefit from this prospect because conforming loans offer lower rates and more loan options than jumbo loans.
| Mortgage Interest Rates* | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Rates as of 08/21/2007: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| *Rates are subject to change due to market fluctuations and borrower's eligibility |
