Daily Mortgage Rate Lock Advisory

Weekly Mortgage Rate Lock Advisory – Sunday Dec. 21st

Rate Lock Advisory – Sunday Dec. 21st

This significantly shortened trading week brings us the release of six monthly or quarterly economic reports and a fairly important Treasury auction. Most of the data being released is not considered to be of high importance to the markets, but with the Christmas holiday falling during the week we can expect very thin trading. This means that we may see a larger reaction than normal to some news because there will be fewer traders working and less transactions being made. We also may see profit-taking by some firms to capture the sizable gains in bonds this year as it winds down, so by no means can we be guaranteed a quiet week.

There is no relevant economic news scheduled for release tomorrow. Five of the week’s events are scheduled for Tuesday. The first is the final revision to the 3rd Quarter GDP. I don’t think this data will have an impact on mortgage rates unless it varies greatly from its expected reading. Last month’s first revision showed that the economy contracted at a 0.5% annual pace during the quarter and this month’s revision is expected to show the same.

The next two are November’s Existing and New Home Sales reports. The Existing Home Sales release will come from the National Association of Realtors while the New Home Sales data is a Commerce Department report. Both give us a measurement of housing sector strength and mortgage credit demand, however, neither are considered to be of high importance. Both of the reports are expected to show a drop in sales.

The fourth report of the day also comes late morning when the revised University of Michigan Index of Consumer Sentiment for December is posted. Current forecasts are calling for a small downward revision from the preliminary reading of 59.1. This is important because rising consumer confidence indicates that consumers may be more apt to make large purchases in the near future. An unexpected upward revision could lead to higher mortga ge rates Tuesday.

The last event on Tuesday that is worth noting is the 5-year Treasury Note auction. If the sale is met with a decent demand from investors, we could see interest in other notes and bonds such as mortgage-related bonds increase during afternoon trading. But, a lackluster interest from investors may also lead to weakness in bonds and possible upward afternoon revisions to mortgage pricing.

The remaining two reports are scheduled for release Wednesday at 8:30 AM. This is when November’s Personal Income and Outlays data and Durable Goods Orders will be posted. The Income and Outlays report will give us an important measurement of consumer ability to spend and current spending habits. Since consumer spending makes up two-thirds of the U.S. economy, any related data usually has a fairly significant impact on the financial markets and mortgage rates. Current forecasts are calling for no change in income and a 0.8% decli ne in spending. If this report reveals weaker than expected readings, we should see the bond market improve and mortgage rates drop slightly Wednesday

The last piece of data will be the Commerce Department’s Durable Goods Orders for November. This data gives us an important measurement of manufacturing sector strength by tracking orders for big-ticket items or products that are expected to last at least three years. Analysts are expecting the report to show a decline in the neighborhood of 3.1%. A larger decline would indicate that the manufacturing sector was weaker than many had thought. This would be good news for the bond market and should drive mortgage rates lower. However, a smaller than expected drop in orders could lead to mortgage rates moving higher early Wednesday morning.

Overall, I am expecting to see some movement in the markets and mortgage rates, but nothing drastic unless we get some surprising results from the week ‘s data. The bond market will close early Wednesday and Friday and be closed all day Thursday. This means that firms that trade bonds will likely be keeping only a skeleton staff most of the week. Still, my biggest fear between now and the end of the year will be selling bonds to capture profits from the significant rally of the past several weeks. That could lead to bonds falling and mortgage rates rising.

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.

Tags: association of realtors, closing, commerce department report, downward revision, existing home sales, index of consumer sentiment, lock, mortgage credit, national association of realtors, quarter gdp, release tomorrow, report, treasury auction, U.S., Wednesday, week

Daily Mortgage Rate Lock Advisory – Friday Dec. 12th

Rate Lock Advisory – Friday Dec. 12th

Friday’s bond market has opened in positive following the release of mixed economic data and early stock market losses. The stock markets are well into negative ground with the Dow currently down 130 points and the Nasdaq down 5 points. The bond market is currently up 12/32, but we will still see an increase in this morning’s rates of approximately .250 of a discount points due to weakness late yesterday.

This morning brought us the release of three relevant economic reports, two of which are considered to be highly important to the markets. The first was November’s Retail Sales report that showed a 1.8% decline in retail level sales last month. This was a little stronger than the 2.0% drop that was expected, but is not enough of a difference to significantly affect mortgage rates.

The second piece of data was November’s Producer Price Index (PPI) that also was close to forecasts but slightly favorable to bonds. This index measures inflationar y pressures at the producer level of the economy and showed a larger than expected drop of 2.2%. However, the core data reading that excludes prices for more volatile food and energy items matched forecasts of a 0.1% increase. Therefore, the data was pretty much a non-factor in today’s pricing.

The last report of the day was the preliminary reading to the University of Michigan’s Index of Consumer Sentiment. This index measures consumer willingness to spend and is considered moderately important. It showed a much higher level of sentiment than was expected with a reading of 59.1. Analysts were expecting it to come in at 55.0. But, since the stock markets are showing losses and today’s key data didn’t reveal any significant surprises, this index also has not heavily influenced today’s trading or mortgage rates.

Next week is moderately busy with economic reports. There are a couple of relevant reports scheduled for release including the Consumer Pric e Index (CPI). However, the big news of the week may be the last FOMC meeting of the year on Tuesday. But look for details on next week’s events in 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… Lock if my closing was taking place between 21 and 60 days… Lock 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.

Tags: closing, index cpi, index measures, index of consumer sentiment, lock, producer level, producer price index, producer price index ppi, Release, relevant reports, stock, stock market losses, today, volatile food

Daily Mortgage Rate Lock Advisory – Wednesday Nov. 26th

Rate Lock Advisory – Wednesday Nov. 26th

Wednesday’s bond market has opened in positive territory following weaker than expected economic news. The stock markets are currently in positive ground after initially opening with losses. The Dow is now showing a 42 point gain while the Nasdaq is up 28 points. The bond market is currently up 19/32, which should improve this morning’s mortgage rates by approximately .250 of a discount point.

The first piece of data released this morning was October’s Durable Goods Orders that showed a drop of 6.2% in new orders and revised September’s orders lower than previously announced. Analysts were expecting to see a 2% drop in October’s orders, meaning that demand for big-ticket products was much weaker than thought. In fact, this was the largest monthly decline in approximately two years. That is good news for bonds and mortgage rates, because the slowing economic activity makes mortgage related bonds more attractive to investors.

The second was Oct ober’s Personal Income and Outlays data, which gave us mixed results. The bad news came in the income portion of the report that revealed a 0.3% rise in income compared to forecasts of a 0.1% increase. This means that consumers have more money available to spend than was expected. However, the good news was that they spent less than analysts had predicted. What was supposed to be a 0.7% decline in spending actually came in at a 1.0% drop. With consumer spending making up two-thirds of the U.S. economy, the weaker than expected spending is taken as good news for bonds.

This month’s revision of the University of Michigan’s Index of Consumer Sentiment was also favorable to bonds and mortgage rates with a reading of 55.3. This was much lower than the 58.0 that was expected, indicating that consumers were less optimistic about their own financial situations than analysts had thought. This means they are less likely to make large purchases in the near future.

The last report of the day was October’s New Home Sales figures that showed that sales of newly constructed homes fell to its lowest level in almost 18 years. While this is generally good news for bonds and mortgage rates, this data is not considered to be oh high importance to the markets, therefore, its impact ton today’s trading and mortgage rates has been minimal.

The bond market will close at 2:00 PM ET today ahead of tomorrow’s Thanksgiving Day holiday and will reopen Friday morning. There is no relevant data scheduled for release Friday, so I am expecting to see a very light and thinly traded day. The bond market will also close at 2:00 PM Friday, so look for little activity that day.

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 clos ing 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.

Tags: bond, bond market, consumer spending, durable goods orders, financial situations, index of consumer sentiment, lock, mortgage rates, outlays, personal income, point gain, stock markets, U.S.

Rate Lock Advisory – Friday Nov. 14th

Rate Lock Advisory – Friday Nov. 14th

Friday’s bond market has opened in positive territory following the release of weaker than expected economic news. The stock markets are posting sizable losses after yesterday’s late rally in stocks hurt bond prices and mortgage rates. The Dow is currently down 260 points while the Nasdaq has lost 60 points. The bond market is currently up 22/32, but due to yesterday’s late losses we likely will not see much of an improvement in this morning’s mortgage rates.

October’s Retail Sales report was posted this morning, showing a surprising drop in sales of 2.8%. This was a larger decline than was expected, the fourth consecutive monthly drop and the largest monthly decline since January 1987. This indicates that the economy is still softening, which is good news for the bond market and mortgage rates.

The second report of the day was the preliminary reading to the University of Michigan’s Index of Consumer Sentiment for this month. This index measures consumer confidence, which gives us an indication of consumer willingness to spend. It revealed a reading of 57.9 that was a little stronger than expected, but not enough to negatively affect bond trading.

Next week is moderately busy with economic reports but it does bring us the release of two key inflation readings that can significantly impact bond prices and mortgage rates. The week kicks off Monday with the release of October’s Industrial Production that tracks manufacturing output. This report is considered to have a medium level of importance to the markets and is expected to show a small decline in output.

Besides the two inflation readings and Monday’s manufacturing report, we also will get the minutes from the last FOMC meeting and a couple of other lesser important releases. Look for more details on next week’s events in Sunday’s weekly preview.

If I were considering financing/refinancing a home, I would…. Lock if my closin g 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.

Tags: bond, bond prices, bond trading, consumer confidence, decline, economic reports, Float, fomc meeting, index measures, index of consumer sentiment, medium level, refinancing a home, Release, report, week

Rate Lock Advisory – Sunday Nov. 9th

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.

Tags: balance report, bond, bond auctions, closing, consumer confidence, domestic currency, economic reports, index measures, index of consumer sentiment, international investors, lock, mortgage rates, report, U.S., veterans day holiday, week

Rate Lock Advisory – Friday Oct. 31st

Rate Lock Advisory – Friday Oct. 31st

Friday’s bond market has opened in positive territory, allowing mortgage rates to recover part of this week’s losses. The stock markets are showing small gains with the Dow up 25 points and the Nasdaq up 3 points. The bond market is currently up 17/32, which will likely improve this morning’s mortgage rates by approximately .375 of a discount point.

None of today’s three economic reports gave us any major surprises. The Labor Department said that the 3rd Quarter Employment Cost Index (ECI), which tracks employer costs for salaries and benefits, rose 0.7% last quarter. This was expected and has not had much of an influence on the markets.

September’s Personal Income and Outlays report revealed a 0.2% rise in income and a 0.3% decline in spending. The income reading was slightly higher than expected, meaning that consumers had a little more income to spend that thought. The drop in spending was bigger than forecasted, meaning consumers were spend ing less than thought. The income reading can be considered negative news for bonds, but the drop in spending offsets that news. Therefore, this report also failed to push the markets either way.

The week’s last report was the University of Michigan’s revision to their Index of Consumer Sentiment for this month. It showed a reading of 57.6 that nearly matched forecasts of no change to the 57.5 preliminary reading. Again, this data had little impact on the markets and mortgage rates.

Next week is fairly active in terms of economic releases for the markets to digest. Monday brings us the first with the release of the Institute for Supply Management’s manufacturing index. This is usually the first report we see each month and is considered to be pretty important. It is expected to show that manufacturer sentiment slipped further in October.

The rest of the week also brings us some important data including October’s employment numbers next Fr iday. Look for more details on next week’s releases and events in Sunday’s weekly preview.

If I were considering financing/refinancing a home, I would…. Float 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.

Tags: closing, cost index, economic releases, economic reports, employer costs, employment numbers, Float, index of consumer sentiment, institute for supply management, negative news, quarter employment, report, spending, week

Rate Lock Advisory – Friday Oct. 17th

Rate Lock Advisory – Friday Oct. 17th

Friday’s bond market opened relatively flat compared to recent trading sessions despite favorable economic news. The stock markets are up slightly with the Dow up 11 points and the Nasdaq up 6 points. The bond market is currently up 4/32, which will likely keep this morning’s mortgage rates at yesterday’s levels.

There were two economic report posted this morning, with both of them giving us weaker than expected results. September’s Housing Starts came in at a 17-year low, further supporting the theory that the housing sector is far from a recovery. The 6.3% drop in new starts was a much larger decline than analysts had forecasted. This is good news for bonds, but since the data is not considered to be of high importance, it has had a minimal impact on mortgage rates.

The second report of the day and the last of the week was October’s preliminary reading to the University of Michigan’s Index of Consumer Sentiment. It showed a reading of 57.5, which was well off from forecasts of a 65.0 reading. This means that consumers were much less optimistic about their own financial situations than many had thought. That is also good news for mortgage rates because waning confidence usually means consumers spend less, which in turn slows economic activity and eases inflation concerns.

Next week is very light in terms of economic releases scheduled to be posted. Monday does bring us one of the week’s few reports with the posting of September’s Leading Economic Indicators (LEI) that attempts to predict economic activity over the next three to six months. It is a moderately important report and may cause a slight change in mortgage rates.

Look for more details on next week’s events in Sunday’s weekly preview.

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.

Tags: closing, economic releases, economic report, financial situations, Float, housing starts, index of consumer sentiment, inflation concerns, leading economic indicators, LEI, lock, minimal impact, refinancing a home, report, trading sessions, week

Rate Lock Advisory – Friday Sep. 26th

Rate Lock Advisory – Friday Sep. 26th

Friday’s bond market has opened in positive territory following a negative open in stocks and weaker than expected economic news. The markets are reacting more to news of the possible failure of the Fed bailout than today’s economic data. The stock markets are showing losses with the Dow down 32 points and the Nasdaq down 16 points. The bond market is currently up 11/32, but I don’t believe we will see much of a change in this morning’s mortgager rates.

Neither of today’s economic releases are considered to be of high importance, but both gave us results that were favorable to bonds. The first was the final revision to the 2nd Quarter Gross Domestic Product (GDP) that showed a revised rate of growth of 2.8%. This was a sizable downward revision to the previous estimate of a 3.3% annual rate and lower than analysts had expected for this revision. This means that the economy grew at a slower rate than many had thought during the 2nd quarter of the year.

The second report of the day and the final report of the week was the revised reading of the University of Michigan’s Index of Consumer Sentiment. The preliminary reading that was released earlier this month revealed a 73.1 reading, but today’s update showed a 70.3 reading. This was also lower than forecasts and hints that consumers are less optimistic about their own financial situations than thought, which usually means they are less likely to make large purchases in the near future.

Next week is packed with economic news for the markets to digest. There is relevant data scheduled for release every day of the week, beginning with August’s Personal Income and Spending data Monday morning. Look for details on next week’s events in 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… 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.

Tags: bond market, closing, downward revision, economic releases, fed bailout, financial situations, index of consumer sentiment, lock, mortgager, rate, refinancing a home, relevant data, stock markets, today, week

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.

Tags: bailout plan, big ticket items, bond, bond market, closing, durable goods orders, index of consumer sentiment, inflation concerns, lock, mortgage rates, negative territory, quarter gdp, release tomorrow

Rate Lock Advisory – Friday Sep. 12th

Rate Lock Advisory – Friday Sep. 12th

Friday’s bond market has opened fairly flat despite sizable stock losses during early trading. The stock markets are showing losses as investors worry about the future of Lehman Brothers. There is growing concern that the 158-year old financial institution will fail if not sold or if other drastic measures are not taken very soon. The result is renewed fears about the stability of U.S. banks that has pushed the Dow down 124 points and the Nasdaq down 22 points. The bond market is currently down 2/32, but we will still .likely see a small improvement in this morning’s rates as a result of strength late yesterday.

The Commerce Department gave us today’s first piece of relevant economic news with the release of August’s Retail Sales data. They reported that sales fell 0.3% last month when it was expected to rise by the same amount. This means that consumers were much less active than many had thought. However, this is good news for the bond market and mortgag e rates.

The second of today’s three releases was August’s Producer Price Index (PPI). It showed a 0.9% drop in the overall reading, meaning that prices paid at the producer level of the economy fell by a wider margin than what was thought. This is good news for the bond market, but the more important core data reading matched forecasts with an increase of 0.2%. Overall, this report can be considered somewhat favorable to bonds and mortgage rates.

The last report of the week was the University of Michigan’s Index of Consumer Sentiment late this morning. It indicated that consumers were much more optimistic about their own financial situations than many analysts had expected. The 73.1 reading was much higher than the 64.0 that was expected. This reading is considered bad news for bonds and mortgage rates because consumers tend to spend more when they have more faith in their own financial situation.

Next week is fairly active in terms of e conomic releases with several scheduled that can influence mortgage rates. The first comes Monday morning with the release of August’s Industrial Production report. It will be posted mid-morning Monday and is considered to be of moderate importance to the markets. Look for more details on next week’s events in 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 and cannot be guaranteed to be in the best interest of all/any other borrowers.

Tags: bond, closing, core data, drastic measures, index of consumer sentiment, lehman brothers, lock, producer level, producer price index, producer price index ppi, report, retail sales data, stock losses, U.S.