My Thoughts for the Week of July 5th, 2016

Mike Thomas

Mike Thomas

  Hope everyone enjoyed their extended 4th of July weekend, a chance to gather with friends and family. Most know that only 2 founding fathers actually signed the Declaration of Independence on July 4, 1776, with most signing on Aug 2, 1776. But what most don’t know is that a Docusigned copy did go out to the founding fathers but a private email server issue is actually what caused the 1 month delay. Seriously tho, e-signature services like Docusign have been around for about 12 years but adoption has been slow by the mortgage industry. Much progress has been made and we are happy to say almost all initial loan disclosures can now be e-signed to help save some paper and speed up the loan application and submission process. Final loan docs of course still need to be wet signed with a notary.

Mortgage rates have been improving so far in 2016, somewhat to the surprise of the bond markets post QE. Fear and concerns over a slowing global economy has helped to keep rates low. And now with the UK voting to leave the European Union (aka Brexit), more uncertainty with how it will affect global markets has caused another push lower for Treasury bond yields and mortgage rates. It will take some time for this to play out, including chatter that there could be a “do over” on the referendum vote, but as uncertainty wanes rates could increase. Domestically we have our monthly employment report coming this Friday. Strong employment growth is typically negative for interest rates, but the focus continues to be overseas so not too much attention on that statistic right now. Best to keep an eye on the Brexit story and demand for government bonds like the 10yr US Treasury. Right now could be an excellent opportunity to lock in among the lowest interest rates we have seen.

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