First Team’s Weekly Mortgage Watch (July 29th, 2018) This Week Highlights The Following Updates:
- Housing and GDP dominated the news last week, with mortgage rates nudging slightly upward.
- Both Existing and New Home Sales moved downward again, creating some discussion that we may be at the peak for this cycle with some predicting a significant downturn to come.
- However, it is likely too early to predict any real dramatic future plunge according to experts.
- GDP for Q2 blasted to its highest level since 2014, leading some to predict years of supercharged growth. The majority of economists don’t share that view, and few are predicting an annual GDP rate over 3.0% for 2018.
- This week could be a huge week for financial markets. In addition to the ISM Indices, Consumer Confidence, and monthly employment data, the Fed meeting adjourns on Wednesday.
- The market is expecting no change in the Fed’s rates, but we could get hints as to whether this strong GDP report, coupled with a solid labor market and moderate inflationary pressure, are enough to shift Fed policy to signal the potential for the Fed to consider adding another rate increase in the near future.
FHFA Forced To Pause New Credit Score Decision
An estimated 7.6 million Americans may have the equivalent of a 620 credit score if a new model could be adopted for those lacking traditional credit scores. FHFA was due to issue an update on its process of developing that new score, but a bill that passed in May has taken precedent. The new law will undo some of the changes made by Dodd-Frank Wall Street Reform and Consumer Protection Act. A new credit score may still in the future, but no timeline is set.