Per ATX Lender Joel Richardson, Reviewing July, you can see we’ve had a ½ point reduction in lending interest rates!

 Reviewing July, you can see we’ve had a ½ point reduction in rate! That’s the 30yr conventional and that’s what 99% of the market thinks when we mention rates. I’ll take it! On a $500K loan, that is a $166/mo savings which helps folks get into homes!

 

Rates on July 1:

• 30yr fixed Conventional: 6.99% (APR= 7.128%)
• 15yr fixed Conventional: 5.99% (APR= 6.107%)
• 30yr fixed FHA/VA: 6.375% (APR= 7.288%)
• 30yr fixed Jumbo: 7.375% (APR= 7.516%)
• Investor- Conventional 30yr fixed: 7.625% (APR= 7.867%) 

Rates on July 31:

• 30yr fixed Conventional: 6.49% (APR= 6.617%)
• 15yr fixed Conventional: 5.75% (APR= 5.904%)
• 30yr fixed FHA/VA: 6.0% (APR= 6.991%)
• 30yr fixed Jumbo: 7.0% (APR= 7.184%)
• Investor- Conventional 30yr fixed: 7.0% (APR= 7.288%) 

What’s driving this?

First, Treasury yields have come down. The demand for US-backed debt helps drive mortgage rates. So, if there is more demand, bond yields/rates go lower. If no demand, yields move higher to attract investors/buyers

Secondly, we’re seeing deflationary reports and more slack in the labor market—even if it’s not much slack, it’s still slack.

 

What about The Fed?

It’s nice to have a FOMC meeting conclude on the last day of the month. Some small fireworks from Fed Chair Powell on Wednesday: the Fed is closer to making a 0.25% rate cut. When will that be? That’s up for debate, but I don’t think it will be before the election as traditionally, the Fed wants to be apolitical in its duties. So, that means November or December. The November FOMC meeting is one-day after the election. Remember, The Fed determines the Fed Funds rate which is overnight borrowing between large banks. Mortgage rates are the exact opposite: long-term debt to consumers. BUT—the Fed determines rate direction which is important.

 

Thanks!
Joel

 

 

Joel Richardson​​​​ SVP ‑ Central Texas Mortgage Manager, Austin VeraBank, N.A. P: 512-222-0140   EXT. 7740  |  877-566-2621  M: 512-203-8244 E: jrichardson@verabank.com  |  W: myfinanceteam.com A: 1111 W. 6th Street, Bldg B, Suite 200 ,  Austin ,  Texas   78703 NMLS # 136881 This electronic message, including any attachments, is intended only for the use of the individual or entity to  ​which it is addressed and may contain information that is confidential and/or legally privileged. IF YOU ARE NOT  ​THE INTENDED RECIPIENT, OR AN EMPLOYEE OR AGENT RESPONSIBLE FOR DELIVERING THE COMMUNICATION  TO THE INTENDED RECIPIENT, BE AWARE THAT ANY REVIEW, DISCLOSURE, COPYING, PRINTING, DISTRIBU‑ ​TION OR USE OF THE CONTENTS OR ATTACHMENTS CONTAINED HEREIN IS STRICTLY PROHIBITED. If you have ​received this electronic transmission in error, please notify me by telephone (903) 657‑8521 or by returning the  ​transmission via electronic mail immediately and permanently delete the message from your system(s).