Alan Bailey - Network Funding - Branch Manager

Interest rates have been range bound since early December, oscillating between 4.10% and 4.20% on the 10-year treasury.

Yesterday afternoon, President Trump suggested that Fannie and Freddie should and can buy up to $200B in MBS. This amount is ~15% of what the Fed purchased during covid, so a return to 3% is unlikely. The initial result has been an increase in price for note rates that fall into the 5.0 coupon and below and a decrease in price for note rates that fall into the 6.0 coupon and above. The 5.5 coupon note rotes initially saw a rally in price but have since reversed a majority of those gains – which leaves our production note rates largely unchanged.

This morning, the BLS delivered a Goldilocks jobs report – 50k new jobs vs expectations of 56k. Not too many jobs to lead the Fed to believe we don’t need rate cuts and not too few jobs to lead the market to believe the economy is in grave danger. Perfection, 10/10, no notes. Cherry on top – the unemployment rate ticked down to 4.4% from a downwardly revised 4.5% (from 4.6%) in November.

With Jobs in the rearview, the market will now look forward to the ensuing inflation data hitting the tape next week – CPI Tuesday and PPI Wednesday – to give the Fed more clarity on the direction of interest rates. As things stand currently, market expectations are for no rate cuts in January and two rate cuts total in 2026. The first coming mid summer and the second mid fall.

Ever wished you could fast-track your mortgage payoff like you'd jump the line at your favorite coffee shop? ☕

Enter the "Principal Curtailment Option" (PCO)! It's a nifty way to knock down your mortgage principal faster than the regular pace. By making extra payments, you're effectively reducing the amount you owe, which means less interest over time and a quicker path to homeownership bliss. 🏡

Imagine it like taking shortcuts on a road trip—you're still on the journey, just getting to your destination a bit quicker. 🚗💨

PCO is all about flexibility and control over your mortgage journey. Whether you're a newbie homebuyer or a seasoned mortgage pro, this option can be a game-changer.

Ever tried this or thought about giving it a go? Share your thoughts or questions below!

”$409,200: Median existing-home price3 for all housing types, up 1.2% from one year ago ($404,400) – the 29th consecutive month of year-over-year price increases.”

Source: https://www.nar.realtor/newsroom/nar-existing-home-sales-report-shows-0-5-increase-in-november