San Diego Mortgage Rates Update 01/11/2010

San Diego mortgage rates moved slightly higher last week despite worse than expected employment data. There are no reports on the economic calendar today but the week ahead will have some items of interest that may move rates.  To help readers make sense of these reports and how they affect rates a good rule of thumb is that worse than expected economic data benefits fixed income securities like bonds and mortgage backed securities (MBS) while better than expected data benefits the stock market.

Throughout the week the government will auction @$75 Billion in new debt.  Continued strong demand for our nation’s debt will help to keep rates low! On Wednesday the Mortgage Banker’s Association will give us a look at their mortgage application index. This will help us gauge demand in the housing sector since the report distinguishes between refinance and home purchase applications.  The 3 reports most likely to move San Diego Mortgage rates are the retail sales and jobless claims reports on Thursday and the consumer price index on Friday.  Our economy is based on consumer spending and both retail sales and jobless claims speak directly to that factor. Higher retail sales and lower jobless claims means more Americans are working and spending!  On Friday the consumer price index will help gauge inflation which is perhaps the #1 factor the Fed uses when setting interest rates. If consumer prices are higher than expected the government will raise rates to slow things down.

My wholesale lenders issued rate sheets that were basically unchanged from Friday.  The 30 fixed rate is  in the 4.875% to 5.125% range for well qualified borrowers.  Well qualified assumes a credit score of 740, a loan to value at 80%  and one point loan origination.  You may elect to pay less in upfront fees, but you will have to accept a higher interest rate. Check back tomorrow for news affecting San Diego mortgage rates!