Mortgage bonds are trading flat on the day.

The Fed's Fischer is a known inflation hawk, but he stated today that he sees inflation pressures spreading beyond food and energy. Wholesale inflation, the Producer Price Index (PPI), rose 1.2% in July.  This was double expectations and left the year-over-year figure at a whopping 9.8%.  That's the biggest gain in 27 years, pushed largely by record oil prices.

Excluding that figure, the Core PPI was still 3.5%, the largest increase since 1991. So far; however, the market has taken these inflation figures in stride since they were so strongly influenced by the oil spike.

Yesterday, the Mortgage Bankers Association announced that the volume government-insured FHA loans are up over 300% since last year.   We recently ran our FHA Week that serves as a decent primer.

The Freddie Mac National Mortgage Rate survey is due out again later this week.  Rates came in at 6.52% with costs of .7% of a point last week.  At these rates, for even slightly damaged credit, the fixed rate and lack of credit penalties on the IHDA loan can be a great option.  There is an EXTREMELY LIMITED amount of funds remaining in the City of Chicago Mortgage Program.  This 4% Grant program is a great option for first-time homebuyers and this program will be different (less lenient) once these funds are exhausted.