The coronavirus has officially made its mark in the United States with the Centers for Disease Control reporting its first case of human-to-human transmission. So what does that have to do with your mortgage rates? 

That news from the CDC caused the Dow to drop by about 200 points as investors got a little shaky about stability. When investors retreat to the relative safety of purchasing government bonds, mortgage rates tend to fall. We are seeing the 10-year Treasury note yield drop back to levels similar to August and September of last year, when rates dropped dramatically. Just a week ago the yield was trading at 1.762% at its high, and was trading early Friday morning at 1.553%.

The Federal Reserve Open Market Committee again decided to maintain the current overnight lending rate of 1.5%-1.75%. The main concern held by FOMC members is that if they don’t push for inflation, there will be little room to cut should the economy experience a downturn moving forward. 

The Mortgage Bankers Association weekly report on mortgage applications has already seen activity tick upwards quickly, with January’s data hitting an 11-year mid-month high. Mortgage rates dropped again this week as the Treasury note yields dropped. The Freddie Mac 30-year fixed-rate mortgage average went down to 3.51% this week, the second-lowest in three years. 

Liz Pritchard  |  Jr. Loan Officer

NMLS 1767063

Office (252) 564-5023

Fax (252) 562-0642