Rate Lock Advisory – Thursday Sep. 25th | Daily Mortgage Rate Lock Advisory

Rate Lock Advisory – Thursday Sep. 25th

Rate Lock Advisory – Thursday Sep. 25th

Thursday’s bond market has opened in negative territory after the stock markets have opened with strong gains. Stocks are rallying after some of the hurdles that may have prevented the bailout plan from being approved appear to have been tackled. The result is the Dow up 202 points and the Nasdaq gaining 35 points. The bond market is currently down 9/32, which will likely push this morning’s mortgage rates higher by approximately .125 of a discount point.

The Commerce Department gave us August’s Durable Goods Orders results this morning, saying that new orders for big-ticket items fell 4.5% last month. This drop was over four times analysts’ forecasts, meaning that the manufacturing sector was much weaker than thought. This is considered to be good news for bonds and mortgage rates because slowing economic activity will likely ease inflation concerns and make long term securities such as mortgage-related bonds more attractive to investors.

Augus t’s New Home Sales were also posted this morning, showing that sale of newly constructed homes fell to their lowest level since October 1991. This strongly indicates that the housing sector is still weakening and not ready to bottom out yet. That is also good news for the bond market and mortgage rates.

There are two reports scheduled for release tomorrow. The first is the final revision to the 2nd Quarter Gross Domestic Product (GDP). Since this data is aged now and the preliminary reading of the 3rd Quarter GDP will be released next month, I don’t see this revision having much of an impact on the financial markets or mortgage pricing. It is expected to show a slight increase from the previous estimate of a 3.3% annual rate.

The final report of the week is Friday’s release of the University of Michigan’s Index of Consumer Sentiment. This is the revised reading for September. The preliminary reading that was released earlier this month revealed a 73 .1 reading. Analysts are expecting to see a downward revision to 70.9, meaning confidence was weaker than previously thought. A lower than expected reading should help improve mortgage rates tomorrow 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… Lock 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.