Winter Haven, Florida Weekly Mortgage Update: March 9, 2009

Last week, we saw Winter Haven mortgage rates improve as investors once again sought refuge in safer … um “Havens!”

With major stock indices reaching 12-year lows, investors are moving cash to the bond market. This, as we’ve said here before – is GREAT for mortgage rates!

We’re seeing some special stuff here, folks…

Mortgage rates closed lower this week than they opened – marking only the second time this year in which this has occurred.

Let’s take a minute to reflect on why this happened (though, I’m not sure you care – nor would I – just take the rate and run!):

Some key factors causing mortgage rates to fall last week included:

The US unemployment rate rising to 8.1 percent
Uncle Ben and the Fed lowered their economic outlook for 2009
Investors developed some serious concerns about long-time blue chip darling, General Electric

Financial banking institutions US Bank and Wells Fargo did their part to keep mortgage rates low by cutting their dividends by roughly 85 percent each. Though, I’m pretty sure this was due to their desire to shore up their balance sheets. Note - both of these banks are generally considered as well-run.

Mortgage News for the Week Ahead

Save for Thursday’s Retail Sales data report, there really isn’t much going on this week that might have any sort of impact on mortgage markets. As such, markets will look for other clues about the future of the U.S. economy.

Tuesday, Fed Chairman “Uncle” Ben Bernanke will speak about financial reform, with Congress taking up mark-to-market accounting on Thursday.

I know, I know… this last one sounds like a dry topic, but mark-to-market is the accounting rule that makes banks take losses on assets they’ve yet to sell.

Some experts think mark-to-market accounting makes the financial system appear weaker than it is so this is why Congress is starting a debate.

If mark-to-market rules are loosened, it would likely spell good news for the stock market and bad news for mortgage rates. (Boo!) In effect, money would flow in the opposite direction as it did last week. (ibid… Boo!)

For now, mortgage rates are still very low. But, if there’s even a whisper that mark-to-market accounting rules will change near-term, mortgage rates should rise.

If you’re currently floating a mortgage rate with your lender, consider locking it in. If you still need to be pre-approved for your refinance, home purchase (including short sale purchases), give me a call at 863-604-3019, and we’ll get you set up. For even quicker response, you may apply for your Florida home loan online.

(Image courtesy: The Wall Street Journal Online)

Bernanke Visits Hometown, Pledges Forceful Action (blogs.wsj.com)
Lower wages next? (americablog.com)

I hope you found this post useful! As always, if you or anyone you know is in need of a local Florida mortgage loan originator, I’m your guy. Call me at 888-859-7418 or apply online for your Florida mortgage. We’ll keep you posted and let you know when it’s time to pull the trigger!

Technorati Tags: Ben Bernanke, Business, Mortgage, Stock Market, United States, United States Economy, Wall Street, Wells Fargo, winter haven florida, Winter Haven Mortgage Rates