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John Shapiro of Private Mortgage Advisors (affiliate of Wells Fargo Mortgage) forecasts that “I think we will see flat rates at these levels until the fall. At that point I would expect a seasonal increase but not a dramatic one. Rates won’t dramatically rise until unemployment improves markedly.”
John also says that, “based on continuing economic bad news the yield on the 10 year treasury has continued to fall. This decline would normally mean lower rates but that is not what we are seeing. Rates have been almost flat for the past several weeks despite big drops in the bond yield which indicates to me that the rates are as low as they are going to be barring a geopolitical disaster.”
I my Sunday blog post I noted that Wells Fargo was introducing several new programs 8/16/10. The first allows for expanded LTV’s on many high balance conforming mortgages. Another expansion includes increased ability to use retirement assets for reserves. Additionally, as of Monday the qualification on all short term ARMS (3/1 ARM and 5/1 ARM) now includes a more stringent qualification metric (620 credit scores instead of 720).