Weekend Update September 18

30 Yr Fixed Conforming – 6.375%

15 Yr Fixed Conforming – 6.125%

30 Yr Fixed Jumbo 7.625%

5/1 LIBOR ARM – 6.75% (w/ 1pt)

7/1 LIBOR ARM – 6.5% (w/ 1 pt)

30 Yr FHA – 6% Prime 5%

6 Month Libor – 3.12% Last week

6 Month Libor – 3.25% This week

Some weeks surprise me with how little there is to talk about when it comes to the economy; this is not one of those weeks.

Rates dipped on Monday but have shot up since. Today we are about .375% higher than last week except for FHA which is the best rate out there.

As I am sure you heard; the Fed held the Funds Rate steady so Prime is still at 5%. I am happy with this decision as I believe a strong dollar is the #1 priority for our economy at this point in time.

Also, although we may not be feeling it yet, we will see gas prices drop as oil has finally broken the $100 barrier on its way back down to reality. As I mentioned before, I expect to see gas below $3 here in the near future.

The nation's homebuilders frantically cut production of new homes in August by 6.2% in an effort to eliminate inventory on the market. Building permits plunged to a 26-year low. And believe or not - that's all a good thing for the mortgage industry - longer term. The more builders cut production, the sooner the single-family residential market can begin to recover. The tilting point will occur when the total number of starts falls below the monthly new home sales pace for at least three months. We are not there yet, but the new home starts number is certainly headed in the right direction.

If you have a minute, please the articles below. They are actually quite insightful and I was impressed to find them.

Links:

http://money.cnn.com/2008/09/17/news/economy/housing/index.htm?postversion=2008091715

http://money.cnn.com/2008/09/17/news/economy/colvin_recession.fortune/index.htm?postversion=2008091713