Fed Meeting Statement Points To Continuing Low Interest Rates

Wednesday's Federal Open Market Committee (FOMC) statement indicates the Federal Reserve's commitment to keeping long term interest rates and inflation under control.

The Fed will continue monitoring inflation, but does not expect inflation to rise more than 0.50 percent above its target rate of 2.00 percent over the next one to two years.

Ongoing monitoring of inflation and unemployment, as well as developing economic news, will guide the Fed in its future determinations concerning policy for its present iteration of quantitative easing (QE3).

Currently, the Fed purchases $85 billion of treasury securities and mortgage –backed securities each month with the goal of keeping long-term interest rates lower.

This includes mortgage rates, which can assist homebuyers with qualifying for mortgage loans in an environment of increasing home prices. Other goals include stabilizing the labor market, and limiting inflation.

Job Growth To Be Determining Factor On Fed Interest Rate Action

The statement also noted that the Fed will keep its interest rates between 0.00 and 0.25 percent, until the Fed sees the national unemployment rate fall below 6.50 percent.

While noting that the housing sector is improving, the Fed stated concerns about ongoing high unemployment rates. Jobs are a key aspect to supporting the economy, as 70 percent of the U.S. economy involves the purchase of goods and services by consumers. 

The Fed also repeated its position to evaluate the efficacy of its quantitative easing program; if the agency finds that the program is not achieving their desired objectives, changes to the program can be expected.

While a clear majority of FOMC members voted to keep current policies intact, one member voted against this course of action citing the potential for continued quantitative easing at current levels to fuel inflation.

The bottom line for today's statement is that the Fed continues its "wait and see" position concerning quantitative easing and low federal interest rates.The committee also re-asserted its intention to gradually reduce quantitative easing when it's time for a change.

In addition, the Fed is committed to monitoring a wide range of economic data with an eye toward adjusting its policies in the best interest of economic recovery. 

Post-Fiscal Cliff, Mortgage Markets Turn Attention To Jobs Data

Mortgage rates moved higher Wednesday up congressional leaders voted to avoid the "Fiscal Cliff".

Mortgage-backed securities (MBS) fell as investors bid up stock prices. Confidence among investors and consumers typically causes mortgage rates to rise. That's what happened Wednesday.

For Thursday and Friday, expect jobs data to dictate where Minneapolis mortgage rates are headed.

The Federal Reserve has said that the national Unemployment Rate will dictate future monetary policy, with the central banker planning to raise the Fed Funds Rate from its target range near zero percent once joblessness falls to 6.5%. Currently, the jobless rate is 7.7 percent.

As the jobs market improves, equity markets should follow, causing mortgage rates to -- again -- move higher.

Thursday's Initial Jobless Claims report has already influenced today's mortgage rates. New claims rose 10,000 to 372,000 for the week ending December 29, 2012. This is slightly higher than Wall Street expected and mortgage bonds are moving better on the news.

Now, Wall Street turns its attention to Friday's Non-Farm Payrolls report. 

More commonly called "the jobs report", Non-Farm Payrolls is a monthly publication from the Bureau of Labor Statistics, detailing the U.S. employment situation, sector-by-sector. The economy has added 4.6 million jobs since 2010 and analysts expect another 155,000 added in December 2012.

The Unemployment Rate is expected to tally 7.8%.

As more people get back to work, the nation's collective disposable income rises, which gives a boost to the U.S. economy. Furthermore, more taxes are paid to local, state and federal governments which are often used to finance construction and development -- two jobs creators in their own right.

Furthermore, as the ranks of the employed increase, so does the national pool of potential home buyers. With demand for homes high and rents rising in many U.S. cities, demand for homes is expected to grow. Home supplies are shrinking.

If you're currently floating a mortgage rate, or wondering whether it's a good time to buy a home, consider than an improving economy may lead mortgage rates higher; and an improving jobs market may lead home prices higher.

The market is ripe for a refinance or purchase today.

October Jobs Report Blows Away Estimates; Mortgage Rates Falling

Another month, another good showing for the U.S. economy.

Mortgage rates are performing surprisingly well after Friday's release of the October 2012 Non-Farm Payrolls report. The Bureau of Labor Statistics' monthly report beat Wall Street expectations, while also showing a giant revision to the previously-released job tallies of August and September.

171,000 net new jobs were created last month against calls for 125,000 and revisions for the two months prior totalled 84,000.

October also marked the 25th consecutive month of U.S. job growth -- a period during which 3.8 million jobs have been reclaimed. This sum represents more than half of the 7.3 million jobs lost between 2008-2009.

Nationally, the Unemployment Rate rose by one-tenth of one percent last month to 7.9%. It may seem counter-intuitive to see unemployment rates rise even as job growth soars. However, it's a sign of economic strength.

October's rising Unemployment Rate is the result of more workers entering the U.S. workforce and actively looking for jobs, a manifestation of rising consumer confidence levels and optimism for the future.

Typically, mortgage rates in Minnesota would worsen on a strong jobs report like this. This month, however, rates are improving. This is mostly the result of Hurricane Sandy, which is expected to create a drag on the U.S. economy with its $50 billion damage tag.

The storm has Wall Street looking past the strong jobs report, positioning itself for the next few months. Investors are moving into less risky assets until the uncertainty surrounding the storm's effects subside. Mortgage-backed bonds are considered "safe" and are benefiting from this safe haven buying pattern.

For home owners and buyers in Maple Grove and nationwide, the shift is yielding an opportunity to lock mortgage rates at artifically-low levels. 30-year fixed rate mortgages remain well below 3.50% for borrowers willing to pay discount points, and home affordability is approaching an all-time high.

Home values are expected to rise through 2013 so consider this week's low rates a gift. If you're in a position to go to contract and/or lock a mortgage rate, you may want to take that step today.

What's Ahead For Mortgage Rates : Week Of May 29, 2012

Mortgage markets worsened slightly last week as demand for mortgage-backed bonds slacked. There was little surprise in U.S. economic data and the unfolding story lines of the Eurozone continued unabated.

Mortgage rates in Minnesota worsened slightly on the news, climbing for the first time in two weeks.

The change was a small one, however, and rates only eased higher Wednesday through Friday. As such, Freddie Mac's weekly mortgage rate survey failed to capture the change -- Freddie Mac's survey is conducted Monday and Tuesday. 

According to the Primary Mortgage Market Survey, the average 30-year fixed rate mortgage rate slipped to 3.78% last week, on average, down from 3.79% during the week prior. At the same time, the number of discount points charged by banks increased to 0.8 from 0.7.

Stated differently, 30-year fixed rates mortgage rates dropped but mortgage applicants paid higher fees to get access to them. 1 discount point is equal to $1,000 per $100,000 borrowed.

Freddie Mac also reported no change in the 15-year fixed rate and the 5-year adjustable rate mortgage rates. Average mortgage rates for the twp benchmark products remained at 3.04% and 2.83%, respectively, with no change in discount points.

This week, mortgage rates figure to show a bit more movement. It's a 4-day week because markets were closed for Memorial Day, and there is a glut of new data set for release. Most notably, the May Non-Farm Payrolls report hits Friday morning.

The jobs report affects mortgage rates because mortgage rates are linked to U.S. economic strength. Wall Street is expecting to see 164,000 net new jobs created in May. If the actual results fall short of that estimate, mortgage rates should fall. If the actual number exceeds estimates, mortgage rates should rise.

Other releases include the Case-Shiller Index, Consumer Confidence, the Pending Home Sales Index, and Personal Income and Outlays. 

What's Ahead For Mortgage Rates This Week : May 14, 2012

Mortgage markets worsened slightly last week as positive U.S. economic news overshadowed growing concerns for the Eurozone's future. Political and economic issues continue to weigh on Greece and Spain, and it's still unknown how France's new President will change that nation's fiscal direction. 

Conforming mortgage rates in Minnesota edged higher on the week overall.

Last week was light on economic data, but the figures released suggest an improving U.S. economy.

For example, the Bureau of Labor Statistics reported 3.7 million job openings nationwide this past March, marking the highest amount since July 2008. Voluntary separations (i.e. "quit jobs") increased, too -- also at levels not seen since 2008.

Voluntary separations may hint at labor market improvement because employees rarely leave a steady-paying job without the prospect of a new job ahead. Furthermore, the four-week moving average of first-time unemployment claims fell for the first time in a month.

The jobs market is one of two key sectors expected to lead the economy forward this year.

The other is housing and, this week, there will be two key housing reports for Wall Street to review. The first is Tuesday's homebuilder confidence survey from the National Association of Homebuilders. The second is Wednesday's Housing Starts data for April.

Mortgage rates may also be affected by the Tuesday release of the Retail Sales report and Consumer Price Index report; and, by the Federal Reserve's Wednesday release of the FOMC Minutes from its last meeting.

For home buyers and mortgage rate shoppers, mortgage rates remain at all-time lows. According to Freddie Mac, the average 30-year fixed rate mortgage rate nationwide is 3.83% for borrowers willing to pay 0.7 discount points and a full set of closing costs -- the lowest rate-and-fee combination in Freddie Mac's recorded history.

However, low mortgage rates may not last much longer -- especially if the Eurozone can reverse course on its ailing economies.

Mortgage rates remain volatile and sensitive to changes in market conditions. If today's mortgage rates fit your budget, consider locking in.

Homes Get More Affordable On March Jobs Data

Americans continue to get back to work.

Last Friday, in its Non-Farm Payrolls report for the month of March, the Bureau of Labor Statistics announced 120,000 net new jobs created, plus combined revisions in the January and February reports of +4,000 jobs.

The March report marks the 18th straight month of job growth nationwide -- the first time that's happened in 5 years.

The Unemployment Rate dipped in March, too, falling one-tenth of one percent to 8.2%. This is its lowest national Unemployment Rate since February 2009.

Clearly, the jobs market is moving in the right direction. Yet, after the Non-Farm Payrolls report was released Friday morning, stock markets dropped and bond markets gained -- the opposite of what a casual market observer would expect.

It happened because, although job growth was strong, Wall Street decided it just wasn't strong enough. The market expected 200,000 jobs created in March at least and the actual reported figure fell short.

Lucky for you, Wall Street's pain is Main Street's gain. After the jobs report was released, mortgage rates immediately dropped to a 3-week low, making homes more affordable in Minnesota and throughout all 50 states.

The market's reaction is an excellent example of how important jobs data can be to home affordability -- especially in a recovering economy.

The economy shed 7 million jobs between 2008-2009 and has since added more than half of them back. Wall Street pays close attention to job creation because more working Americans means more consumer spending, and more consumer spending means more economic growth.

Rate shoppers caught a bit of a break on the March payroll data. By all accounts, the labor market recovery in underway and, as it improves, higher mortgage rates are likely nationwide. For now, though, there's a window for low mortgage rates that buyers and would-be refinancing households can try to exploit.

If you're actively shopping for a home or a mortgage, today's mortgage rates may be at "last chance"-like levels. Once rates rise, they're expected to rise for good.

Fewer Jobless Claims Suggests Higher Home Prices Ahead

Economists believe the strength of the 2012 housing market will be closely tied to jobs. If they're right, the housing market is ripe for a boost. It spells good news for Plymouth home sellers and may mean the end of bargain-basement prices for buyers.

Since peaking in mid-2009, the number of U.S. workers filing for first-time unemployment benefits has dropped 44 percent. Over the same period of time, the U.S. economy has added more than 2 million jobs and the national Unemployment Rate is down more than 1 percentage point to 8.3%.

Employment's link to the housing market is both economic and psychological.

To make the economic link is straight-forward. A person with a job earns verifiable income and such income is required in order to be mortgage-eligible. For conventional and FHA purchase loans, for example, mortgage lenders want a home buyer's monthly income be more than double his monthly debts. 

For the formerly unemployed that have since returned to work, having a full-time income makes buying homes possible. It also supports higher home valuations nationwide because home prices are based on supply-and-demand. All things equal, when the number of buyers in a market goes up, prices do, too.

The psychological connection between housing and employment is a tad more complicated, but every bit as important. It's not just out-of-work Americans that don't look for homes -- it's fearful Americans, too. People with concerns about losing a job are just as unlikely to shop for homes as people actually without a job. The same is true for people unsure of their prospects for a better-paying job, or their own upward mobility.

A recovering job market can lessen those fears and draw out buyers -- especially those who face a loss on the sale of an "underwater" home.

The Initial Jobless Claims rolling 4-week average is at its lowest level since 2008. Fewer Americans are losing jobs, and more are finding permanent placement.

It's one more reason to be optimistic for this year's housing market. 

Are You Locked ? Friday's Job Report Will Make Mortgage Rates Move.

If you're floating a mortgage rate, or have yet to lock one in, today may be a good day to call your loan officer. Friday morning, the government releases its Non-Farm Payrolls report at 8:30 AM ET.

The Non-Farm Payrolls report is more commonly called the "jobs report" and, lately, it's been Wall Street's domestic economic metric of choice. As jobs go, so go markets.

In the 12 months beginning November 2007, the economy shed 2.3 million on its way to losing more than 7 million jobs by the end of 2009.

It's no coincidence that the stock market has been wayward. Jobs are a keystone in the U.S. economy and the connection between jobs and growth is straight-forward :

1. Workers spend more than non-workers and consumer spending is the economy's largest single component 
2. Workers pay more taxes to governments and, when governments have money, they build and spend on projects 
3. Additional consumer and government spending creates revenue for businesses which, in turn, hire more workers.

It's a self-reinforcing cycle. More employees begets more employees.

As a rate shopper in Minnesota , this is an important understanding. Job loss was, in part, behind the big drop in mortgage rates since 2007. A weak economy drives investors away from equities and into safer securities such as mortgage bonds (which are backed by the U.S. government).

The excess demand causes mortgage rates to drop and that's exactly what we've seen. Since late-2007, mortgage rates have been in decline.

In the first 11 months of 2011, though, 1.5 million people went back to work; the economy showed signs of shoring up and economic optimism is returning. Mortgage markets have temporarily ceded to the Eurozone, but with one more strong jobs report to close out the year, momentum could tip and stock markets could roll.

If that happens, mortgage rates will rise. Maybe by a lot.

This is why Friday's Non-Farm Payrolls data is so important. Economists expect that 150,000 new jobs were created in December. If the government's actual number is larger than that, prepare for higher mortgage rates.

Conversely, if job creation falls short of 150,000, mortgage rates may fall.

If the prospect of rising mortgage rates makes you nervous, remove your nerves from the equation. Call your loan officer and lock your rate ahead of Friday's Non-Farm Payrolls release.

What's Ahead For Mortgage Rates This Week : November 7, 2011

Mortgage markets improved last week as optimism for a Greek Bailout program faded, triggering a global flight-to-quality assets. Fear of a Eurozone rift outweighed positive economic remarks from the Federal Open Market Committee and an in-line U.S. jobs report.

Although the Federal Reserve said the economy had "strengthened somewhat", a statement backed up by Friday's Non-Farm Payrolls data which -- with revisions -- met analyst expectations, concern that Greece may not receive its aid caused mortgage to fall.

Conforming mortgage rates dropped throughout Minnesota Monday and Tuesday, pushing rates to near their lowest levels of the year. Rates remained low through Friday.

According to Freddie Mac's weekly mortgage market survey, the average 30-year fixed rate mortgage is 4.00% nationwide, plus closing costs and an accompanying 0.7 discount points.

A "discount point" is a one-time loan fee paid at closing, where 1 discount point is equal to 1 percent of your loan size.

As an example, 1 discount point on a $300,000 home loan costs $3,000.

This week, with no new economic due for release, the fate of mortgage rates in Plymouth again depends on what develops in Europe. If Greece cannot reach accord within its own parliament, and cannot enact the austerity measures as dictated by its aid package, mortgage rates should fall this week, too.

However, if Greece can reach agreement and move forward, it will appease investors worldwide and U.S. mortgage rates should resume rising. Likely by a lot.

Remember : The U.S. economy has shown slow, steady improvement of late and, normally, this would result in higher mortgage rates for consumers. That's not what we've experienced, however. Instead, fears of a Greek debt default have dominated headlines.

As soon as markets are certain that Greece has a way forward, attention will return to the U.S. economy, and mortgage rates are expected to rise.

Therefore, float your mortgage rate with caution this week. Depending on global events, mortgage rates may rise or fall. Eliminate your interest rate risk. Lock your rate today.

What's Ahead For Mortgage Rates This Week : October 24, 2011

Mortgage markets improved last week on worries that Eurozone leaders would decline to send aid to Greece. These concerns overshadowed optimism for the U.S. economy, the result of several strong data points.

Conforming rates across Minnesota eased, giving homeowners and rate shoppers yet another chance to nab historically-low mortgage rates. FHA mortgage rates remained low, too.

According to Freddie Mac, the average 30-year fixed rate mortgage rate is now 4.11% with 0.8 discount points. For loans with zero points, expect to pay slightly higher rates. 

Rate-shoppers and home buyers would do well to pay attention.

This week's may be as good as mortgage rates get. Possibly forever. This is because the market conditions that helped rates stay low -- a weak U.S. economy and uncertainty in Europe -- are eroding.

The U.S. economy has posted strong jobs, spending, and confidence figures in the past 3 weeks and Eurozone leaders appear closing making a deal that will help Greece avoid a sovereign debt default.

Once markets no longer worry about these two events, rates are expected to surge.

Eurozone leads met all weekend and have chosen Wednesday, October 26, as a likely "decision date" for Greece. If that date holds, and if an agreement can be reached, U.S. mortgage bonds will sell-off and mortgage rates will rise.

The housing sector is set to release important news this week, too.

After last month's increase in Housing Starts and steady Existing Home Sales report, Wall Street will watch for this week's New Home Sales, Case-Shiller Index and Pending Home Sales Index. If momentum stays strong for housing, that, too, should pressure mortgage rates higher.

Mortgage rates remain near all-time lows. If you've yet to lock your mortgage rate, or are still shopping, consider that rates have more room to rise than to fall. The "safe play" is to execute a lock today.

What's Ahead For Mortgage Rates This Week : September 12, 2011

Mortgage markets improved last week as a weakening Eurozone and questions about the U.S. economy sparked a global flight-to-quality. Conforming and FHA mortgage rates improved for the second week in a row.

The storylines should sound familiar by now. They are the same ones that have dictated the path of mortgage rates since April 2011. As a result, according to Freddie Mac, mortgage rates across Minnesota and nationwide are now at an all-time low.

Not in 50 years of tracking mortgage rates has pricing been so favorable.

Last week's holiday-shortened week didn't begin well for rate shoppers in Plymouth. Rates moved higher on the expectation of additional economic stimulus from two separate parts of the government -- the Federal Reserve and Congress. 

Wall Street held high hopes for Ben Bernanke's address to the Economic Club of Minnesota, and for the President's address to a joint session of Congress. It expected Fed Chief Bernanke to reveal clues about the Fed's next move; and it expected the President to unleash a massive jobs creation program that would put more Americans to work.

Both outcomes would have harmed mortgage rates as money flowed into stocks. However, neither happened. Bernanke kept mum on the Federal Reserve's options and the White House announced a jobs program smaller in scope than was expected.

Mortgage rates fell throughout the day Thursday then received a big boost Friday.

Amid rumors of a pending Greek default and the potential credit downgrades of several Eurozone banking groups, safe haven buying picked up and drove mortgage rates down.

Markets open this week with rates lower than they've ever been in history.

There isn't much new data set for release this week so market expectations will continue to set the direction in which mortgage rates go. If concerns for a Eurozone default rise, mortgage rates should fall. Conversely, if Eurozone chatter settles, mortgage rates should rise.

For now, mortgage rates remain at all-time lows and should not be taken for granted. If you see a rate that makes sense for you, consider locking it in.

Strong Job Growth In July Trumped By Credit Downgrade

More Americans are getting back to work.

The latest Non-Farm Payrolls survey from the Bureau of Labor Statistics shows that 117,000 net new jobs were created in July, thumping analyst estimates and surprising Wall Street investors.

In addition, May and June's originally-reported figures were both revised higher:

• May 2011 was revised higher by 28,000 jobs
• June 2011 was revised higher by 28,000 jobs

The national Unemployment Rate slipped to 9.1 percent.

The jobs report's strong readings would typically be a boon to stock market and a threat to mortgage rates. This is because more employed Americans means more disposable income spent on products and services; and more taxes paid to governments at the federal, state and local level.

This combination fuels consumer spending and supports new job growth, a self-reinforcing cycle that spurs economic growth and often to draw investors into equities.

This month, however, the market reaction has been decidedly different.

Since the Friday release of the July Non-Farm Payrolls report, the Dow Jones Industrial Average has lost close to 6 percent of its value. Furthermore, mortgage bonds -- which typically sink on a strong jobs figure -- have thrived.

High demand for mortgage-backed bonds have pushed mortgage rates below their all-time lows set last November; the biggest cause of which is Standard & Poor's credit downgrade of U.S. government-issued debt.

Ironically, the credit rating downgrade sparked a surge of safe haven bidding that has been tremendous to rate shoppers and home buyers in Plymouth and nationwide. Bond buyers are flocking to the U.S.

If you've been shopping for a mortgage, therefore, or recently bought a home, use this week's action to your advantage. Call your lender and ask about rates. You may be surprised at what you find.

A Mortgage Rate Strategy For July's Jobs Report

At 8:30 AM ET Friday, the Bureau of Labor Statistics will release the July 2011 Non-Farm Payrolls report. Mark it in your calendar. If you've been watching mortgage rates fall to new all-time lows this week and fear a mortgage rate reversal, Friday could be the day.

The monthly Non-Farm Payrolls data can swing a big stick in mortgage markets.

More commonly called "the jobs report", Non-Farm Payrolls details the U.S. workforce, providing sector-by-sector analysis of workforce, as well as the national Unemployment Rate. 

The jobs report affects mortgage rates because of how important jobs are to the U.S. economy.

When there are more working Americans:

1. There's more consumer spending, a boost to businesses
2. There's more tax collection, a boost to governments
3. There's more personal savings, a boost to households

In July, analysts anticipate 85,000 new jobs created. This would be a 4-fold increase from June's 18,000 figure.

The Unemployment Rate is expected to remain unchanged at 9.2%.

For rate shoppers and home buyers in Minnesota , these Wall Street expectations can be as important as the actual data itself. Right now, traders placing bets, expecting 85,000 new jobs in July. If the final tally is more than 85,000, traders will load up on equities at the expense of bonds. This is because job growth is good for the economy.

When bonds sell off, rates rise.

Conversely, if jobs growth is less than 85,000, mortgage rates should drop.

Mortgage rates are near all-time lows this morning. By Friday, they could rise. The safe move is to lock your rate today. Rates may fall when the jobs report is released, but there's much more room for rates to rise.

Retail Sales Rise For 12th Straight Month In June

The American Consumer will not be deterred.

Despite worsening jobless figures and an increase in the Cost of Living, Retail Sales are climbing. In June, for the 12th straight month, retail receipts rose, excluding cars and auto parts.

Analysts expected no change from May. Instead, receipts topped $321 billion -- an all-time record.

For home buyers and would-be refinancers in Minneapolis , this is a bit of unwelcome news. Mortgage rates are rising in the wake of the Retail Sales data release.

This is because Retail Sales account for roughly half of consumer spending, and nearly one-third of the economy overall. A rise in Retail Sales, therefore, suggests stronger growth ahead.

Here's how it happens.

As consumers spend more money, businesses sell more product. So, to accommodate burgeoning demand, business hire additional employees, and are forced to make additional capital expenditures as well. 

This rise in spending prompts other businesses to hire and spend; to meet their own respective demand surges. There's a chain reaction-like effect.

Then, with businesses carrying larger payrolls and bigger staffs, federal, state and local governments realize bigger tax bases and can fund new and existing projects. 

This, too, leads to hiring and the cycle repeats.

A weak economic outlook dragged down mortgage rates last week. This week's Retail Sales data reversed that flow. Mortgage rates are higher by 1/8 percent -- roughly $8 per $100,000 borrowed.

Retail Sales are up 8 percent from a year ago.

What's Ahead For Mortgage Rates This Week : July 11, 2011

Mortgage markets improved in roller coaster-like trading last week. And, not surprisingly, the week's two big stories were the same two stories roiling mortgage markets since March -- Greece and Jobs.

In both instances, rate shoppers won. Conforming mortgage rates in Minnesota improved for the first time in 3 weeks last week.

Early in the week, mortgage rates fell as doubts resurfaced on the just-completed Greece aid package. Although an agreement had been reached by the Greek Parliament, investors are wondering if it's a bona fide solution, or delaying an inevitable default.

Talk like this triggers a flight-to-quality, and last week, it led mortgage rates lower.

Then, mid-week, a strong preview of the Friday jobs report led to a reversal. Mortgage markets sold off sharply with the prospect of a blow-out Non-Farm Payrolls number. Analysts upped their estimates 50% -- from 80,000 net new jobs created in June to 120,000 -- and mortgage rates spiked in anticipation.

The rate rise was short-lived, however, because when the actual jobs report was released, it showed just 14,000 jobs added in June. Mortgage markets reversed and mortgage rates sunk to their best levels in 2 weeks.

This week, Greece should remain in the headlines, but there's other rate-changing news, too:

• Tuesday : FOMC Minutes
• Wednesday : 10-Year Treasury Auction
• Thursday : PPI; 30-Year Treasury Auction; Jobless Claims
• Friday : CPI; Consumer Sentiment

If you're still floating a mortgage rate, today marks a good week to lock. Mortgage rates could fall this week and next, but there's more room for rates to rise than to fall. 

Lock up today's low rates while they're still available.

Mid-Year Review : Were The Experts Right About The Market?

The year is half-over. It's an opportune time to take stock of analyst predictions made at the start of the year, and to recognize that the "experts" can be wrong as often as they are right.

For as much experience and authority an expert brings to the conversation, though, nobody can accurately predict the future.

As such, there's often disagreement.

Looking back to December, some housing analysts called for a market rebound this year; while others called for a fall. With respect to mortgages, some said rates had nowhere to go but up; while others expected more dips.

As a layperson, how do you know who will be right?

In short, you can't.

Predictions are a tricky business because they're guesses about the future based on the world as it exists today. When the predictions listed earlier were made, the world was a different place.   

A lot has changed since January:

• Slowing job growth has suggested to slower U.S. economic growth
• Food and energy costs have spiked, adding inflationary pressures to the economy
• Eurozone debt issues have grown, punctuated by a near-Greek default
• Tsunamis have caused widespread damage in Japan
• Earthquakes, floods and volcanoes have harmed economic output

None of these events had occurred as of December, when the original predictions were made. Yet, each of these developments has made a deep impact on housing, and on the economy.  

So, what's a Minneapolis homeowner to do? Think of the present instead.

First, mortgage rates are low today -- extremely low by historical standards. Second, home values have been slow to rebound through most U.S. markets. Combined, these factors have made homes more affordable than it any time in recorded history. It's not only cheap to buy a home right now, it's cheap to refinance one, too.

Analysts are saying the home prices will rise this year, and mortgage rates will, too. Those predictions may ultimately be proven true. Until the future arrives, though, those predictions are just guesses.

Economy Expected To Have Added 80,000 Jobs In June

Friday morning, at 8:30 AM ET, the Bureau of Labor Statistics releases its June Non-Farm Payrolls report. If you're currently shopping for a mortgage, or floating a mortgage rate, be prepared. Mortgage rates can change following the monthly report's release.

Often, by a lot.

More commonly called "the jobs report", Non-Farm Payrolls reports on the U.S. workforce by sector, summarizing its findings in terms of total workforce size, and as a national Unemployment Rate. Jobs are considered a keystone in the continuing U.S. economic recovery. 

More working Americans means:

1. More consumer spending, a boost to businesses
2. More tax collection, a boost to governments
3. More personal savings, a boost to households

For June, analysts expect the government to report 80,000 net new jobs created, and no change in the 9.1% Unemployment Rate.

Although these figures are slightly below than what can be considered "strong growth", that's not what should concern Minneapolis rate shoppers. Mortgage markets react to a deviation from estimates more than to the actual results themselves.

This is because Wall Street placed bets in advance of the jobs report's release. If jobs growth tallies more than 80,000, therefore, it signals better news for the economy than what was expected. This will push banks and investors towards equities, and away from bonds -- including the mortgage-backed kind.

With less demand for mortgage bonds, mortgage rates will rise.

Conversely, if jobs growth is less than 80,000, mortgage rates should fall.

Mortgage rates remain near their lows for the year, but if the June Non-Farm Payrolls report beats estimates of 80,000 jobs made in June, look for mortgage rates to spike. The safe move is to lock today.

What's Ahead For Mortgage Rates This Week : June 6, 2011

Mortgage markets improved last week, carried by the same stories that have led markets better since April. Worries of a Eurozone sovereign debt default mounted, and the U.S. economy's revival showed itself to be slower than originally anticipated.

In Greece, the nation readied itself for its second bailout in two years. The austerity measures of last year have not worked as planned. There are concerns that a default would lead to contagion, delivering the Euro region into an economic tailspin.

These fears spurred a flight-to-quality in bond circles to the benefit of U.S. mortgage rate shoppers.

In addition, last week's U.S. jobs data fell short of expectations, giving another boost to mortgage markets.

There were 3 weak reports:

1. ADP showed 38,000 private-sector jobs created in May. Analysts expected 170,000.
2. The Department of Labor showed 422,000 Initial Jobless Claims. Analysts expected 415,000.
3. The Bureau of Labor Statistics showed 54,000 jobs created in May. Analysts expected 150,000.

Each of these data points underscores the fragile nature of the U.S. recovery, and the weaker-than-expected readings helped mortgage rates improve.

It's the sixth week of 7 that mortgage rates in Plymouth have improved, setting the stage for a new wave of refinances.

This week, there is very little new data on which for mortgage bonds to trade. Therefore, expect the stories from recent weeks to continue to dominate headlines. If Greece's austerity and/or bailout plan is met with investor optimism, mortgage rates should rise. If the plan falls flat, mortgage rates should fall.

There will also be chatter about the U.S. debt ceiling, another potentially negative force on mortgage rates.

If you're floating a mortgage rate right now, consider locking in. There's a lot more room for rates to rise than to fall.

Making A Rate-Lock Plan Before Friday's Jobs Report

Tomorrow morning, at 8:30 AM ET, the Bureau of Labor Statistics releases its Non-Farm Payrolls report for May. If you're floating a mortgage rate right now -- or are in the process of shopping for a loan -- consider locking your rate sooner rather than later.

The Non-Farm Payrolls report can be a major market mover, causing large fluctuations in both conforming and FHA mortgage rates in Maple Grove. It's because of the report's insight into the U.S. economy.

More commonly called "the jobs report", Non-Farm Payrolls is issued monthly. Sector-by-sector, it details the U.S. workforce and unemployment rates. 

Jobs momentum has been strong. Through 7 consecutive months, the economy has added jobs, the government reports. Nearly 1 million new jobs have been created during that time. These are strong figures for a country that lost 7 million jobs in 2008 and 2009 combined.

However, Wednesday, a weaker-than-expected "preview" figure from payroll company ADP has Wall Street wondering whether this month is the month that the winning streak ends.

May's ADP data fell so far short of expectations that investors have had to re-assess their job growth predictions. Earlier this week, the consensus was that 185,000 new jobs were created in May. Today, those estimates are much lower.

The change is leading mortgage rates lower, too.

The connection between jobs and mortgage rates is somewhat straight-forward. Job growth influences mortgage rates because jobs matter to the economy. As job growth slows, so does the economic growth, and that puts downward pressure on mortgage rates.

The opposite is true, too. Strong job growth tends to lead mortgage rates higher.

So, with job growth estimates revising lower, Wall Street has adjusted its "bets" and that's benefiting rate shoppers across Minnesota. Should the actual jobs figures not be so bad, though, expect a quick and sharp reversal; and much higher mortgage rates for everyone.

The safe move is to lock your rate today.

What's Ahead For Mortgage Rates This Week : May 31, 2011

Mortgage markets improved last week ahead of Memorial Day and a 3-day weekend. Bond pricing ending the week higher, pushing conforming mortgage rates in Minnesota down for the 5th week out of six.

Most economic news reported worse-than-expected. Initial Jobless Claims increased sharply, GDP was unchanged, and Durable Orders posted the largest one-month decline since October. Each of these stories reduced inflationary pressures on the economy, contributing to lower mortgage rates.

However, the main driver for U.S. mortgage rates last week was Europe.

One year ago, Greece pledged to lower its spending, cut its deficit, and reduce the number of public programs and benefits. In economic circles, this is known as austerity. For more than a month, however, despite the austerity measures, there has been concern that Greece will fail to meet its debt obligations.

Last week, that concern spiked. It triggered a flight-to-quality that helped U.S. mortgage bonds, and led mortgage rates lower.

Conforming and FHA mortgage rates are now at their lowest levels in more than 6 months.

This week, the biggest news is May's Non-Farm Payrolls report. Although, expect for rates to carve out wide ranges from day-to-day. Until the Greece scenario reaches a resolution, Wall Street will be on edge.

• Tuesday : Consumer Confidence, Case-Shiller Index
• Wednesday : ADP Challenger Report
• Thursday : Initial Jobless Claims
• Friday : Non-Farm Payrolls Report

Plus, four members of the Fed have scheduled speeches.

If you're still floating a mortgage rates, or have otherwise not locked in, luck is on your side. Mortgage rates look poised to fall over the next few days, however, markets have been known to reverse quickly. Therefore, if you've been quoted on a rate that looks acceptable to you, you may not want to gamble on mortgage rates falling further.

The safest decision may be to commit to what's available to you today.