Mortgage spread to Treasury

[tede02]

The spread between the 30 year mortgage and 10-year Treasury averages around 1.5%. With the 10-year hovering around 1.3%, that means mortgage rates could easily find themselves below 3%. I was quoted 3.375% on Tuesday this week. I'm guessing there may be a lag when Treasury's fall sharply and when mortgage rates adjusts. Will be interesting to watch. I'm looking at locking at the end of March.

[TwoCitiesCapital]

The spread between the 30 year mortgage and 10-year Treasury averages around 1.5%. With the 10-year hovering around 1.3%, that means mortgage rates could easily find themselves below 3%. I was quoted 3.375% on Tuesday this week. I'm guessing there may be a lag when Treasury's fall sharply and when mortgage rates adjusts. Will be interesting to watch. I'm looking at locking at the end of March.

 

Had someone at work quoted 3.25% on a refi today and I was given 3.37% yesterday.

 

I'm waiting until April to see if the Fed cuts as the market anticipates. If so, I may hold out to try for sub-3%.

[LounginMKL]

Are they jumbo loans?

[HJ]

3.25% would actually be the lowest ever according to this.  There's a spreadsheet that shows history.  There was a drop of 12.5 bps in 15 year mortgage too at 2.875%.  So we are not quite the lowest on that one, but within 0.125% of it.  How "piggy" do we want to be..., ...  VERY.  :)

 

http://www.freddiemac.com/pmms/

[tede02]

Rates have dropped. I was quoted 3.125% on 30 year conventional mortgage with 0.30% points yesterday. Will be interesting to see if the 10-year Treasury breaks through 1%. I was looking at the long-term spread between the 10-year treasury and 30 year mortgage. It looks like the usual range is 1.5-2%. That means the spread is on the high side right now. Mortgage guy told me this week that rates are always quick to rise and slow to fall. Also told me that there is so much refi activity right now, the banks don't have an incentive to drop rates aggressively. They have plent of business already in other words.

[Jurgis]

If anyone gets 30-year-fixed at below 3% with no points, no fees, let me know where/when/how you got it. Thanks. 8)

[tede02]

The 10-year Treasury broke below 1% today. If rates stay around this level, the 30 year mortgage will very likely dip below 3%.

[kab60]

If anyone gets 30-year-fixed at below 3% with no points, no fees, let me know where/when/how you got it. Thanks. 8)

Come to Denmark, fixed 30 year @ 0,5 :P (I have variable rate, it's at minus 0,3)

[Gregmal]

Got a lows 3s quote today on a 30y. Debating a refi.

[Jurgis]

If anyone gets 30-year-fixed at below 3% with no points, no fees, let me know where/when/how you got it. Thanks. 8)

Come to Denmark, fixed 30 year @ 0,5 :P (I have variable rate, it's at minus 0,3)

 

I might consider buying in Denmark, but (1) they won't give me this rate (2) they won't give me mortgage period I'm afraid.  8)

Thanks for suggestion though.

[CorpRaider]

I wonder if spreads will compress as the nominal rates get silly.  i.e. a sub 150 bp spread might look a lot more relatively attractive to a bond buyer when you are talking about a 1% ten year versus a 5%.  I've been waiting for sub 3% nominal mortgage rates to refi again.  I wonder if my servicer can do a streamline rate and term, where I won't have to mess with appraisal and some of the closing costs.

[Kaegi2011]

Quote yesterday for a refi:

 

7 ARM - 2.75%

15 Fixed - 2.75%

 

Did not get a quote for a 30. 

[gfp]

We're doing a 30 year cash-out refinance right now.  Rates may go way lower but the terms were very good and they are cutting us a large check to use on other types of properties that don't qualify for gov. agency type 30 year loans.  Money is fungible and banks are still wanting 25% down, 20 year amortization, 5 year term, 5%+ for commercial multifamily in the New Orleans market.  Other markets have had much better terms - 7 year, 25 yr. amortization, lower rates, etc..

[mcliu]

If anyone gets 30-year-fixed at below 3% with no points, no fees, let me know where/when/how you got it. Thanks. 8)

Come to Denmark, fixed 30 year @ 0,5 :P (I have variable rate, it's at minus 0,3)

 

Incredible! How does the -0.3% work? Does your principal decline? How much is the bank willing to lend? Would you borrow as much as you can?

[Jurgis]

Quote yesterday for a refi:

 

7 ARM - 2.75%

15 Fixed - 2.75%

 

Did not get a quote for a 30.

 

Yeah, my guy is still quoting 30y fixed above 3.0 (maybe 3.25), which is too high for me.

Gonna wait.

Please post if you see 30y below 3.0.

[hillfronter83]

Quote yesterday for a refi:

 

7 ARM - 2.75%

15 Fixed - 2.75%

 

Did not get a quote for a 30.

 

Yeah, my guy is still quoting 30y fixed above 3.0 (maybe 3.25), which is too high for me.

Gonna wait.

Please post if you see 30y below 3.0.

 

Last week I checked, 30yr is 3.375 without closing cost. I'm waiting for it to go below 3 too.

[CorpRaider]

Quote yesterday for a refi:

 

7 ARM - 2.75%

15 Fixed - 2.75%

 

Did not get a quote for a 30.

 

Yeah, my guy is still quoting 30y fixed above 3.0 (maybe 3.25), which is too high for me.

Gonna wait.

Please post if you see 30y below 3.0.

 

Ditto.

[kab60]

If anyone gets 30-year-fixed at below 3% with no points, no fees, let me know where/when/how you got it. Thanks. 8)

Come to Denmark, fixed 30 year @ 0,5 :P (I have variable rate, it's at minus 0,3)

 

Incredible! How does the -0.3% work? Does your principal decline? How much is the bank willing to lend? Would you borrow as much as you can?

We have a variable interest rate 30 year loan that's interest only for 10 years, but due to negative rates the principal does fall.

 

There's a service fee on top (higher for variable rate loans, less so for fixed), so all in all it's not free but probably more like 0,5 pct. after interest deductibles.

 

Right now the loan is "only" 60 pct. of LTV of our home. Could take it to 80 pct., but if we did that, I'd probably want to get a fixed interest loan (like 0,5 pct. for 30 years) to not have interest rate risk and potential upside from rising rates (Danish mortgage system is based on bonds, so if rates rise, bonds decline and thus one can call them below par).

[TwoCitiesCapital]

Just give it a week or two. Banks are holding the line and anyone who has bought a home in the last 5-8 years probably has pretty decent economics on refinancing. As long as people are lining up to do it, rates will be less competitive to incentivize the deal flow

 

In a week or two, if Treasuries remain anywhere near where they're at, the rates will come down.

[tede02]

I've been shopping around a little bit. Checked with Quicken for the hell of it. Holy balls are they aggressive. Talked with a guy there last week that tried to get me to start the process but I basically brushed him off and said I was just shopping rates. Now I have some woman chasing me down that is a "President's Club Banker" (whatever the hell that is) that claims my profile was "flagged for special incentived pricing." We'll see about that in about 4-weeks. I might lock in (where is to be decided) around April 1st. I need to get underwritten per the terms of my purchase agreement so I'm just having Chase do it out of convenience. The guy there told me to go ahead and shop rates. If I find a lower rate he said they might be able to match. Quicken and Chase both quoted an origination fee of a fixed $1,250 on a 30-year conventional.

[CapriciousCapital]

I just locked in 30-year, 3.0%, no points and net $1200 credit back after loan costs. This is for a conforming loan. The other offer was 2.875% 3-year jumbo with $3700 in loan costs including 0.125% points that would get rolled into the loan from Fifth-Third Bank (caveat: have to move over $100,000 in assets). I had 3 bad experiences at the Fifth-Third Bank branch in the last week while trying to move money over and set up a brokerage account. So, screw 5/3. I went with the 3.0% loan. 

 

I wrote about how I got my rate here-- https://capriciouscapital.com/blog/how-to-get-the-best-mortgage-rate/. I was on the cusp of jumbo/conforming so I looked at rates from both.

[TwoCitiesCapital]

Just give it a week or two. Banks are holding the line and anyone who has bought a home in the last 5-8 years probably has pretty decent economics on refinancing. As long as people are lining up to do it, rates will be less competitive to incentivize the deal flow

 

In a week or two, if Treasuries remain anywhere near where they're at, the rates will come down.

 

Took longer than expected, but I was able to lock in 30-year fixed @ 2.75% with no points earlier this week.

 

Those of you waiting for sub-3% might have some luck now

[Jurgis]

Just give it a week or two. Banks are holding the line and anyone who has bought a home in the last 5-8 years probably has pretty decent economics on refinancing. As long as people are lining up to do it, rates will be less competitive to incentivize the deal flow

 

In a week or two, if Treasuries remain anywhere near where they're at, the rates will come down.

 

Took longer than expected, but I was able to lock in 30-year fixed @ 2.75% with no points earlier this week.

 

Those of you waiting for sub-3% might have some luck now

 

Thanks. I'll have to start looking again.

 

What are your closing costs on this?

[chrispy]

I have just been quoted at 2.75% for 25 and 30yr with 3k rolled into loan, no out of pocket

[TwoCitiesCapital]

Just give it a week or two. Banks are holding the line and anyone who has bought a home in the last 5-8 years probably has pretty decent economics on refinancing. As long as people are lining up to do it, rates will be less competitive to incentivize the deal flow

 

In a week or two, if Treasuries remain anywhere near where they're at, the rates will come down.

 

Took longer than expected, but I was able to lock in 30-year fixed @ 2.75% with no points earlier this week.

 

Those of you waiting for sub-3% might have some luck now

 

Thanks. I'll have to start looking again.

 

What are your closing costs on this?

 

I think those are quoted, in part, as a % of the mortgage - so not certain how valid a dollar amount would be.

 

I have to true up the escrow (and receive my current escrow back in a month), pay the $500 for the appraisal, and remaining closing costs are ~0.50% of loan amount.

 

For me, the breakeven on the transaction is ~6 months