As expected, the extreme volatility in the interest rate market continued.  After a great start to the week on Monday, the mortgage backed security market sold off the rest of the week and drove rates back up.  Today has continued that theme, as it appears rates will continue to head up through out the week.   This recent move by rates is particularly disappointing considering the news from last week’s update.  In summary, last week’s update detailed the continued life-line of government support attempting to stabilize the mortgage market, which came in the form of allowing Fannie Mae to pump billions of dollars in to the mortgage backed security market.  The government’s logic is that by offering Fannie Mae the ability to purchase huge lots of mortgage backed securities, it would put a sense of peace in the mortgage market, and thus encourage Wall Street to finally gain some confidence that it is once again safe to buy mortgages.  However, the upcoming purchasing power of Fannie Mae seems to have had little impact on the mortgage backed security market, seeing as rates have not fallen as a result of this announcement. Other news from Fannie Mae this week, is that they did confirm the additional charges that will be incurred on all conforming loans for credit score.  This will make quoting a rate more dynamic and complex than it’s ever been.  Literately, rates will change for every 5% change in loan to value and every 10 point change in credit score – all the way up to scores of 740!  So, even a borrower with a very good credit score, i.e. 708 may not be receiving the best possible rate/costs versus a borrower who has a 740.  This new system will increasingly reward very high scores, but will be more penal than ever on good to poor scores (710-620). With that in mind, it seems some what futile for me to even offer a weekly “rate” update, since all rates will now be so individualized for each borrower, but nonetheless, just to give you a general sense of what rates are doing, I will certainly continue to put a rate range for the week.Rates for 3/27/2008: 30 Year Fixed under $417,000:   5.625% – 5.875%            30 Year Fixed over $417,000:     6.125%30 Year Fixed FHA:                   5.500%            7/1 ARM:                                    5.125%7/1 Interest Only ARM:               5.125%

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