Mortgage Rate Trend Index

Fannie Mae recently waived the jumbo-conforming premium fee they were charging lenders for loans from $729,750 down to $417,001. Jumbo-conforming rates have already dropped considerably due to Fannie Mae's action. The economy is swirling the drain. Rate drop to the rescue!
Jeff Lazerson, president, Mortgage Grader.com, Laguna Niguel, Calif.

Inflation is rearing its ugly head. Import prices were up more than 15 percent year-over-year in April, the biggest increase on record. Lock in those fixed rates now.
Mike Larson, interest rate and real estate analyst, MoneyandMarkets.com, Palm Beach Gardens, Fla.

Continued inflationary pressure and renewed strength in equities, along with continually constricting mortgage underwriting guidelines will pressure rates to increase slightly.
David Kuiper, mortgage planner, First Place Bank, Holland, Mich.

Rising borrowing costs undermine the rates borrowers will pay. Two issues to monitor: 1) LIBOR reform where U.S. banks have potentially understated their borrowing costs. If this is restated, expect LIBOR to play catch-up, resulting in higher rate, and 2) Liquidity, which the Fed is focused on infusing more and more of. However, less or even low access to liquidity equals higher rates.
Cameron Findlay, chief economist, LendingTree.com, Charlotte, N.C.

Inflation is the Kryptonite to mortgage backed securities. Recent Fed announcements and the continual decline in the Core Personal Consumption Expenditure (inflation) since January has given new hope to bonds. The Fed's accommodative policies have had little effect because they've only attempted to address the write downs of large institutions. It is inconsequential that they've reduced lending costs if the banks are not willing to lend. The crux of the problem is the value of the assets this money would be lent on.
Dan Dowling, senior mortgage adviser and president, United Mortgage Capital Corp., Altamonte Springs, Fla.

The Fed's move to stimulate the economy is now showing some signs of positive activity causing inflationary concerns. Keep an eye out for second-quarter numbers, which may dictate the swing in the bonds. However, lock now if you are closing in the next 30 days.
Steve Levitt, vice president of mortgage lending, Guaranteed Rate, Chicago

Evidence of a stronger economy is attracting investors. More demand for mortgage bonds edges rates down.
Dan Green, Mobium Mortgage, author of TheMortgageReports.com, Cincinnati

Inflation continues to be a worry. Added to that, I suspect spending of checks from Washington will filter into the economic numbers and will cloud the picture somewhat on the spending front. Inflation is not good for rates.
Jim Sahnger, mortgage consultant, Palm Beach Financial Network, Stuart, Fla.

The 10-year is trading at 3.93 percent, and this is a high for the recent few weeks. There are short-term conditions that are driving rates up, but on the other side of the scale we have the increased liquidity in the market. People are now starting to accept the new jumbo conforming. With increased ability, the lenders can decrease the premium and get these sold on money back in the lending hands.
Mitch Ohlbaum, president, Legend Mortgage, Los Angeles

Improving as stocks (rates) are due for a drop.
Barry Habib, CEO Mortgage Market Guide, Holmdel, N.J.

The techs are real ugly. The daily started a bullish (lower rates) move and was quashed. The weekly is bearish (higher rates). The monthly looks as if it will be downcrossed to bearish (higher rates) at the end of this month, which should initiate 15 months of generally higher Treasury yields. Some mortgage rates benefited from FNMA, making the price for jumbo-conforming the same as traditional conforming. So mortgage rates are not moving in harmonious fashion. Yes, we will be benefit from these jumbo-conforming and the true jumbo returning to favor with investors, but if Treasuries form the basis for mortgage rates we are headed for at least one year of higher rates.
Dick Lepre, senior loan officer, Residential Pacific Mortgage, San Francisco

A better-than-expected reading from the Consumer Price Index will only ease inflation worries temporarily. Mortgage rates will plod higher.
Greg McBride, financial analyst, Bankrate.com

The federal funds rate is low and so was inflation in April. I doubt we'll stay in the sweet spot for long, but until the economic data swing decisively in one direction or another, rates will stay in a relatively narrow range.
Holden Lewis, senior reporter, Bankrate.com