Daily Mortgage Rate Lock Advisory

Rate Lock Advisory - Thursday Nov. 13th

Thursday’s bond market has opened in negative territory, erasing part of yesterday’s late rally that came as a result of strong stock losses. The stock markets have opened in negative ground, continuing yesterday’s selling. The Dow is currently down 90 points while the Nasdaq has lost 27 points. The bond market is currently down 4/32, but we will still likely see a small improvement in this morning’s mortgage rates of approximately .125 of a discount point due to strength in bonds late yesterday.

This morning’s first piece of news was the release of September’s Goods and Services Trade Balance report. It gave us the size of the U.S. Trade Deficit, showing a $56.5 billion deficit. That was a little smaller than forecasts of $57.0 billion, but this data is not considered to be of high importance to the markets and has had little impact on this morning’s trading or mortgage pricing.

The other news released this morning was weekly unemployment figur es from the Labor Department. They reported that new claims for benefits jumped to 516,000 last week, exceeding forecasts of 479,000. The previous week’s figures were revised to 484,000, meaning analysts were expecting to see a small decline in claims when we actually saw a sizable jump. While this data is not considered to be of high importance because it tracks only a week’s worth of filings, it can influence trading and rates when it varies from forecasts such as today’s variance.

There are two reports scheduled for release tomorrow morning with one of them considered to be very important to the markets. October’s Retail Sales report is the first and the highly important one because it measures consumer spending. Since consumer spending makes up two-thirds of the U.S. economy, any related data is watched closely. If this report reveals weaker than expected sales, the bond market should thrive and mortgage rates will fall. Current forecasts are calling for a drop in sales of approximately 2.1%.

The second report comes late tomorrow morning when November’s preliminary reading of the University of Michigan’s Index of Consumer Sentiment will be released. This index measures consumer confidence, which gives us an indication of consumer willingness to spend. It is expected to show a reading of 57.0, down from October’s final reading of 57.6.

If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days… Lock if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… 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.

Rate Lock Advisory - Wednesday Nov. 12th

Wednesday’s bond market has opened in positive territory as investors shift funds from stocks into bonds. This has pushed the stock indexes significantly lower again with the Dow down 312 points and the Nasdaq down 46 points. The bond market is currently up 14/32, which should improve this morning’s mortgage rates by approximately .125 - .250 of a discount point over Monday’s rates. The bond market was closed yesterday in observance of the Veteran’s Day holiday.

There is no relevant data being released today, but we will get the results of today’s 10-year Treasury Note auction at 1:00 PM ET. These results can influence bond trading enough to affect mortgage rates this afternoon. If the sale was met with a strong demand from investors, bonds will likely rally and mortgage rates should fall. However, a lackluster interest could lead to weakness in bonds and higher mortgage rates.

The first economic data of the week is September’s Goods and Service s Trade Balance report Thursday morning. It helps us measure the size of the U.S. trade deficit, but usually is not a major influence on bond trading or mortgage pricing. It does affect the value of the U.S. dollar, which makes U.S. securities more attractive to international investors when the dollar is strong. This is because the securities’ proceeds are worth more when sold and converted to the investor’s domestic currency. However, its results will not likely directly lead to changes in mortgage rates.

Overall, look for a fairly quiet week in the mortgage market compared to previous weeks unless something totally unexpected transpires. The two Treasury auctions that are of the most interest are today’s and Thursday’s since they can impact mortgage rates the most. But there is only one important report being posted and that doesn’t come until Friday morning.

If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days… Lock if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… 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.

Rate Lock Advisory - Tuesday Nov. 11th

TUESDAY’S UPDATE:

The bond market is closed today in observance of the Veterans Day holiday and will reopen tomorrow morning. The stock markets are trading today but in negative territory. The Dow is currently down 240 points while the Nasdaq has lost 42 points. Some lenders may post rates today, but will likely use yesterday’s afternoon rates.

This week brings us the release of only three relevant economic reports with only one of them being considered highly important. There is no relevant news scheduled for release tomorrow except for the results of the 10-year Treasury Note auction. Results will be posted at 1:00 PM ET and can influence bond trading enough to affect mortgage rates. If the sale was met with a strong demand from investors, bonds will likely rally and mortgage rates should fall. However, a lackluster interest could lead to weakness and higher mortgage rates.

The first economic data of the week is September’s Goods and Services Trade Balance report Thursday morning. It helps us measure the size of the U.S. trade deficit, but usually is not a major influence on bond trading or mortgage pricing. It does affect the value of the U.S. dollar, which makes U.S. securities more attractive to international investors when the dollar is strong. This is because the securities’ proceeds are worth more when sold and converted to the investor’s domestic currency. However, its results will not likely directly lead to changes in mortgage rates.

Overall, look for a fairly quiet week in the mortgage market compared to previous weeks unless something totally unexpected transpires. The two Treasury auctions that are of the most interest are Wednesday’s and Thursday’s since they can impact mortgage rates the most. But there is only one important report being posted and that doesn’t come until Friday morning.

If I were considering financing/refinancing a home, I would…. Lock if my cl osing was taking place within 7 days… Lock if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… 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.

Rate Lock Advisory - Monday Nov. 10th

Monday’s bond market has opened down slightly following early stock gains. The stock markets have started the week in positive territory with the Dow up 54 points and the Nasdaq up 3 points. The bond market is currently down 2/32, which will likely keep this morning’s mortgage rates at Friday’s levels.

This week brings us the release of only three relevant economic reports with only one of them being considered highly important. It is a holiday shortened week with the bond market closing at 2:00 PM today and remaining closed tomorrow in observance of the Veterans Day holiday. I am not expecting this early close to impact bond trading enough to affect mortgage pricing.

The first data of the week is September’s Goods and Services Trade Balance report Thursday morning. It helps us measure the size of the U.S. trade deficit, but usually is not a major influence on bond trading or mortgage pricing. It does affect the value of the U.S. dollar, which m akes U.S. securities more attractive to international investors when the dollar is strong. This is because the securities’ proceeds are worth more when sold and converted to the investor’s domestic currency. However, its results will not likely directly lead to changes in mortgage rates.

Overall, look for a fairly quiet week in the mortgage market compared to previous weeks unless something totally unexpected transpires. As long as the stock markets remain fairly calm, I am expecting to see mortgage rates follow suit. The two Treasury auctions that are of the most interest are Wednesday’s and Thursday’s since they can impact mortgage rates the most. With only one important report being posted and that doesn’t come until Friday morning, I am expecting the bond market and mortgage rates to step back and take a breath per se, most likely until Friday’s data.

If I were considering financing/refinancing a home, I would…. Lock if my closing was taking plac e within 7 days… Lock if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… 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.

Rate Lock Advisory - Sunday Nov. 9th

This week brings us the release of only three relevant economic reports with only one of them being considered highly important. It is a holiday shortened week with the bond market closing early Monday and remaining closed Tuesday in observance of the Veterans Day holiday.

The first data of the week is September’s Goods and Services Trade Balance report Thursday morning. It helps us measure the size of the U.S. trade deficit, but usually is not a major influence on bond trading or mortgage pricing. It does affect the value of the U.S. dollar, which makes U.S. securities more attractive to international investors when the dollar is strong. This is because the securities’ proceeds are worth more when sold and converted to the investor’s domestic currency. However, its results will not likely directly lead to changes in mortgage rates.

There are two reports scheduled for release Friday. October’s Retail Sales report is the first. This report is very important to the financial markets because it measures consumer spending. Since consumer spending makes up two-thirds of the U.S. economy, any related data is watched closely. If this report reveals weaker than expected sales, the bond market should thrive and mortgage rates will fall. Current forecasts are calling for a drop in sales of approximately 1.2%.

The last of the week’s three reports comes late Friday morning when November’s preliminary reading of the University of Michigan’s Index of Consumer Sentiment will be released. This index measures consumer confidence, which gives us an indication of consumer willingness to spend. It is expected to show a reading of 57.0, down from October’s final reading of 57.6.

There are 10-year Note and 30-year Bond auctions this week, Wednesday and Thursday respectively. Strong or very weak results from these sales could affect the momentum in the bond market and lead to afternoon changes in mortgage rates. It i s common to see pressure in bonds ahead of these sales, but as long as interest from investors is decent we should see those pre-sale losses recovered during afternoon trading of the sale days.

Overall, look for a fairly quiet week in the mortgage market compared to previous weeks unless something totally unexpected transpires. As long as the stock markets remain fairly calm, I am expecting to see mortgage rates follow suit.

If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days… Lock if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… 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.

Rate Lock Advisory - Friday Nov. 7th

Friday’s bond market has opened in negative territory despite the release of a much weaker than expected Employment report. The stock markets are showing gains after a couple of sizable down days this week. The Dow is currently up 84 points while the Nasdaq has gained 17 points. The bond market is currently down 19/32, but we should still see an improvement in this morning’s mortgage rates of approximately .250 of a discount due to a strong rally in bonds late yesterday. This morning’s losses are taking back some of yesterday’s late gains, but mortgage rates are still lower than yesterday’s morning rates.

The Labor Department gave us some surprising readings this morning, saying that the U.S. unemployment rate jumped from 6.1% in September to 6.5% in October. They were expected to show a 6.3% unemployment rate. This was the highest rate of unemployment since March 1994.

The number of payrolls added or lost during the month also opened some eye s. The economy lost 240,000 jobs last month, which was worse than the 200,000 that was forecasted. But equally as bad was a large revision to September’s payrolls. What was previously announced as a loss of 159,000 jobs in September is now being estimated at 284,000. This was the 10th consecutive monthly drop in payrolls and brings the yearly total to 1.2 million jobs lost and the first time we have seen 1 million jobs lost since 2001.

Today’s report gives us little to be optimistic about in regards to the employment sector. It is becoming more and more clear to many analysts that the economy is actually in a recession despite the lack of an official announcement or other benchmark indicators. What is equally concerning is that many think the problems are going to get worse before better. This could be good news for bonds and mortgage shoppers, but the crazy volatility we have seen in the markets recently makes it very difficult to follow historical patter ns or make realistic predictions. There is little doubt that we will see more volatility in the coming weeks.

Next week is light in terms of the number of relevant economic reports scheduled for release. We will get some important data late next week, but the first part of the week there is nothing scheduled for release to be concerned with. This make sit very likely that the stock markets will be the biggest influence on bonds and mortgage rates the first couple of days of the week. But look for more details on next week’s event sin Sunday’s weekly preview.

If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days… Lock if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… This is only my opinion of what I would do if I were financing a home. It is only an opinion an d cannot be guaranteed to be in the best interest of all/any other borrowers.

Rate Lock Advisory - Thursday Nov. 6th

Thursday’s bond market has opened in negative territory despite another round of stock losses and favorable economic news. The stock markets are continuing yesterday’s late selling that drove the Dow down 486 points and the Nasdaq down 98 points. The Dow has currently lost another 174 points while the Nasdaq has fallen 41 points. The bond market has fluctuated this morning between positive and negative ground, but currently stands down 11/32. This should mean that this morning’s mortgage rates will be approximately .125 - .250 of a discount point higher than yesterday’s rates.

This morning’s release of the 3rd Quarter Productivity reading revealed a larger than expected increase of 1.1% in employee output. This was slightly higher than forecasts, but is still considered to be good news for bonds because high levels if productivity allows the economy to grow without inflationary pressures rising.

The second piece of data this morning was last we ek’s unemployment figures from the Labor Department. They reported that 481,000 new claims for benefits were filed last week. This was a drop from the previous week but higher than expected. This news isn’t the cause of this morning’s stock weakness, but today’s data was watched more closely due to the importance of tomorrow’s monthly report.

October’s Employment report will be released early tomorrow morning. It is expected to show that the economy lost 200,000 jobs, that unemployment rate moved from 6.1% to 6.3% and that average earnings rose 0.2% during the month. The large drop in payrolls and 0.2% jump in the unemployment rate are numbers of concern to the markets, therefore, I don’t believe that we will need to see weaker than expected results to see bonds improve and mortgage rates move lower.

I am expecting to see more volatility in bonds and mortgage rates in the days ahead. Accordingly, it may be a good time to lock if closing in the im mediate future. Regardless though, I strongly recommend maintaining contact with your mortgage professional over the next week or so.

If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days… Float if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… 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.