San Diego Mortgage Rates Report: November 14, 2007

Goldman Sachs reiterated, for the eight time yesterday, that its exposure to the sub-prime mortgage crisis was limited; Wall Street responded by buying stocks:

Goldman Sachs Chief Executive Officer Lloyd Blankfein told a New York conference yesterday that the largest U.S. securities firm by market value doesn't plan ``significant'' writedowns from subprime-mortgage securities. Bank of America said its losses will be restricted to $3 billion next quarter and UBS AG analyst Glenn Schorr said the potential for losses at Lehman Brothers Holdings Inc. is ``negligible.''

Bear Stearns followed up with another positive forecast about its sub-prime loss this morning:

U.S. stocks were poised to rally for a second day after Bear Stearns Cos. eased concern that credit- market losses would deepen and retail sales topped economists' forecasts.                    Bear Stearns climbed after the fifth-largest U.S. securities firm said it is regaining hedge-fund customers and it would only write down $1.2 billion from subprime assets this quarter.

What does this mean for mortgage applicants?  The positive momentum for stocks, spurred by the somewhat positive news from the financial sector, should draw money away from mortgage bonds this week.  Economic reports were somewhat flat today and are expected to be flat tomorrow.  While the majority of Wall Street believes that rates will be cut in the near future, we believe that may be priced into the market.  As money flows to stocks and away from bonds, it may cause rates to rise over the next couple of weeks.

We are changing our bias to locking loans at application.

Rates we offer today:

PROGRAM                RATE                APR

3/1 ARM                 5.625%        5.813%
5/1 ARM                5.875%        6.087%
30 Year Fix           6.125%        6.324%

Rates as of 11-14-2007 and are subject to qualification and  market fluctuation.

Equal Opportunity Lender