Mortgage Market
Mortgage Rates briefly snapped a long losing streak yesterday, but pricing is back worse today. I think if you are looking to close on a Purchase or a Refinance in the next 15 to 45 or so days I would LOCK in your rate to play it safe. 30 year fixed at 6% by May 1st? Its very possible. Well at least its 85 degrees outside today. Fed Chairman Ben Bernanke speaking at 130PM. today so no long lunchs.
Inquire within for current Mortgage Rates. bc@SmarterBorrowing.com 617.771.5021
Economic Data
Wednesday’s bond market has opened fairly flat as investors cautiously prepare for today’s important auction. The bond market is currently down 2/32, but we will probably still see an improvement in this morning’s mortgage rates of approximately .125 – .250 of a discount point due to strength late yesterday.
Yesterday’s FOMC minutes did shed some light on the Fed’s current thought process about rates and the economy. They indicated that despite recent signs of the economy gaining strength, they have concerns that it may not be able to continue on that pace. Any concerns about the economy being able to expand are considered to be good news for bonds and mortgage rates. However, the minutes also hinted that the Fed may be closer to raising key short-term interest rates than some had thought. The language that the Fed had been using of “an extended period” when referring to how long they expect those rates to remain this low was clarified to mean a change could come sooner than what was previously thought. Overall, the release didn’t hurt the bond market or mortgage rates, but didn’t do much to help them either.
There are two events worth watching today. The first is the 10-year Treasury Note auction, which is the more likely candidate to affect mortgage rates in my opinion. If the investor demand was indeed weak, we may see selling in bonds this afternoon that lead to upward changes in mortgage rates.
The second event is a speech by Fed Chairman Bernanke at 1:30 PM ET. He is speaking in Dallas and is expected to touch on the economy. If he gives an indication that the economy will have a difficult time recovering at its current pace, we may see bonds react favorably as a result. I suspect that he will not say much that is a surprise, so the likelihood of this event impacting mortgage rates is moderate. Dont plan on rates going back down because of this.
FLOAT or LOCK
If I was closing on a Home Mortgage in the next 0 to 15 Days – LOCK
If I was closing on a Home Mortgage in the next 15 to 30 Days – LOCK
If I was closing on a Home Mortgage in the next 30 to 60 Days – LOCK/FLOAT
If I was closing on a Home Mortgage in the next 60+ FLOAT
This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.
- Are you a possible Massachusetts First Time Homebuyer?
- Do you have a Real Estate client inquiring about current Mortgage Rates?
- Do you have any Refinancing questions?
- Should you be thinking about Refinancing out of your ARM (Adjustable Rate Mortgage)?
- Have your Real Estate clients been Pre Approved?
bc@SmarterBorrowing.com 617.771.5021
Credit: Bloomberg, Yahoo Finance, Mortgage News, MBS Quoteline, WSJ, NY Times
bc@smarterborrowing.com
617.771.5021
Nicely done. Very sound and understandable information.
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