Friday, June 27, 2008
After yesterdays massive selloff of stocks yesterday, it looks as if the bond market is trying it's best to turn positive. A good sign of just how hard this is proving to be, although the DOW dropped over 300 points, the bond struggled to gain little more than 25 Bp. The bond is once again trying to pass 25 Bp for the day, and given the volatility of the news out there, one jump in the stock market and all gains the bond made in the past 4 days are lost. With inflation now above the worrisome 2% the fed likes, and consumer sentiment once again at a 28 year low, the only factor holding bonds back now is the lack of confidence in the banking industry. Speaking about banking, most stated income loans aren't really stated. Lenders are requiring a 4506t on all stated loans and as per the unnamed account reps they are pulling tax records on most (all) loans. If the information doesn't match, the loan is denied. The bond is up 31 Bp for the day, and 29 Bp from when pricing came out. Look for better rates in the afternoon, but keep a wary eye out for a sudden change.
6.375% is what FHA is offering on a 30 yr Fixed. Keep your fingers crossed for improvements.