Mortgage Market Weekly Summary - October 2 2009

It’s been another wild and woolly week in mortgage land. It’s actually been quite encouraging to see applications on the way up to end September / start October and really, with interest rates as low as they are and relatively nice weather, why wouldn’t they be?

I’ve got a few bits of news and analysis for you this week from other sources around the web, consolidated here at good ol’ firstfoundation.ca for your reading pleasure:

- Want a mortgage crystal ball? Watch the bond yields – especially the 5-year. One of our lenders tells us that they’re looking for a spread – i.e. a difference of 1.55 to 1.75% above bond yields. If the yield gets too high, the spread gets too low, and rates have to go up. If the spread gets too big lenders can usually pass on the savings to you the consumer. Right now, if you were calculating the spread on a typical five-year rate of 4.09%, you would subtract the bond yield of 2.49, and come up with a spread of 1.6…which is in the acceptable range. Watching this over the course of a week or two will tell you with some certainty what is going to happen with rates.

- Want to know why your credit score is great, but your credit might still be unacceptable to a lender? Canadian Mortgage Trends has the answer! (Note – I’m glad Melanie and Rob practice in Ontario…their blog rocks and I like it even more than mine).

- Need to know what’s happening in the Edmonton real estate market? As always, Sheldon and Sara from the Edmonton Real Estate Blog can cut through the BS to give you the straight goods on what’s going on in the City of Champions (edit…are we called that anymore? Or did we lose the moniker along with the “Alberta Advantage”?)

- Here at First Foundation we’re not just passionate about mortgages, interest rates, etc…we’re passionate about personal finances too. We find that this might be one of the areas most people we talk to are truly afraid. It’s too bad, because so many smart people we know just aren’t taking the time to do a few little things that could really help themselves financially. Million Dollar Journey has a good post up about simplifying your finances .

Hope you have a great weekend, and do feel free to give us a call if you have any questions about this mortgage stuff…it’s what we love to do.