Initial Jobless Claims Drop, Mortgage Rates Increase

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Peoples Home Equity comments on today's initial jobless claims release.

Peoples Home Equity was happy to see initial jobless claims show steep decline for last week ending on December 21st . The decline marks a possible reigniting of weekly mortgage applications. Mortgage rates already reacted to the news by increasing in rates.

Peoples Home Equity has been vocal in its past press releases regarding its confidence that jobless claims would resume their decline. In its December 12th release titled “Initial Jobless Claims Surge 22% Week-Over-Week” the lender states that it “expects the numbers to resume their downtrend.” Indeed, on December 26th initial claims fell 11% which is the largest weekly decrease in the past 24 months. Initial claims now stands at 338,000 while the 4 week average is 348,000.

Unfortunately, the market was unable to see if the decline in initial jobless claims was inversely correlated to a possible rise in weekly mortgage applications. Due to the closing the Mortgage Bankers Association offices from December 25th, next weekly mortgage applications survey report for the week ending December 27th will not post until post until January 1st.    

As Peoples Home Equity is expects the unemployment rate to trend lower, it also believes initial jobless claims to return to their weekly readers of 290k-325k. Meanwhile, as labor conditions improve and the Federal Reserve tapers its quantitative easing program, the lender believes any home buyers on the sidelines should at least apply for a home loan now before mortgage rate make the possibility to expensive.

Peoples Home Equity hopes everyone is enjoying the holiday season. Should one need assistance with applying for a mortgage this winter feel free to contact a PHE loan officer at: (855)-897-0300

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Ornis Mala
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