Bankrate's conventional 30-year reads 7.52% this morning, unchanged from Tuesday and 3 bps below Monday's 7.55%, so the selloff that set yesterday's edition has paused rather than reversed. A week ago it read 7.34%, which leaves the sheet 18 bps worse over seven days. Tuesday gave bonds their first break in a while: Treasury's daily curve closed the 10-year at 5.27%, down from 5.31% Monday, and Mortgage News Daily traced the move to a drop in oil prices rather than any new data. That relief is being tested early today, with the 10-year trading near 5.35%. The 15-year sits at 6.80%, also flat on the day.
Thursday, October 8, brings weekly jobless claims and the next Freddie Mac PMMS. Last week's PMMS read 7.28%, up 25 bps on the week and 57 bps over 30 days on that survey. CPI follows in the October 10 to 15 window, and the Fed's October 27 to 28 meeting carries no dot plot; the effective fed funds rate is 3.88%. Until CPI lands, the calendar offers little to change the picture, so oil and the long end of the curve are what to watch.
On range, 7.52% sits 3 bps under the top of both the 30-year's 30-day band (6.83% to 7.55%) and its 90-day band (6.57% to 7.55%), against a 30-day average of 7.16% and a 90-day average of 6.87%. Today's lens is government lending. On Bankrate, FHA reads 7.23% and VA 7.26%, 29 and 26 bps under the conventional 30-year. Those two series only resumed on August 19, so their honest window is since mid-August, and both are at the top of it (FHA 6.32% to 7.23%, VA 6.34% to 7.26%). On a $400,000 loan, FHA at 7.23% is about $2,723 a month in principal and interest before mortgage insurance, against about $2,802 on the conventional 30-year.
The borrowers to focus on today are open applications with credit and down payment that fit more than one program and no lock yet. The rate gap alone does not settle FHA versus conventional, because FHA mortgage insurance and conventional PMI price differently by credit score and down payment, so run both to the full payment before you recommend either. Do this today: Pick your three unlocked files that qualify for both FHA and conventional, build a full side-by-side payment including mortgage insurance for each, and send it ahead of Thursday's numbers.