Hi Friends,

This is a CRAZY time for everyone and for many reasons, but also especially in the mortgage industry. We’re experiencing crazy time mortgage rate lows.

I have had over 100 new loan requests in the last two weeks, which is 15 more loans than I closed all of last year, the third best year in my 25-year career! 

Fed Rates at Recession Lows

Many of you are now aware that the Fed has just cut their target rate to 0% – .25%, which is where rates were for eight years during and post the Great Recession. Mortgage rates will eventually follow that trend. In addition, last Thursday, March 12th, the Fed injected $1.5 Trillion in liquidity into the markets. The Fed is purchasing $500 Billion of treasury bonds from the market as well as $200 Billion in Mortgage-Backed Securities.

Staffing & Money for Refinance Rush

In less panicked times, these moves would push mortgage rates lower but there are a couple of factors that have caused mortgage rates to increase over the last week. With a 500% increase in refinance applications, mortgage lenders don’t have the staffing to keep up with the volume.

Additionally, mortgage lenders are worried that with this historic increase in loan volume, they could run out of money to lend. Hopefully, the Fed’s move to inject liquidity and purchase mortgage-backed securities from the markets will alleviate the fears about running out of money to fund loans.

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