Daily Mortgage Rate Lock Advisory

Rate Lock Advisory – Tuesday Oct. 21st

Rate Lock Advisory – Tuesday Oct. 21st

Tuesday’s bond market has opened up sharply following early stock losses. The stock markets showing sizable losses, erasing a good portion of yesterday’s late rally. The Dow is currently down 2 02 points while the Nasdaq has lost 47 points. The bond market is currently up 22/32, which will likely improve this morning’s mortgage rates by approximately .500 of a discount point or .125 in rate.

There is no relevant economic data scheduled for today or tomorrow. As expected, we are seeing the bond market fluctuate with stocks. Since stocks are in selling mode, the recent jump in bond yields has made bonds more attractive to investors. This is especially true with stocks unable to keep solid footing. The result is a significant improvement to this morning’s mortgage rates.

With no data scheduled for release tomorrow and only weekly unemployment claims due Thursday, look for similar action in bonds the next two days. I feel there is still more roo m for bonds to improve and mortgage rates to move lower, so I am holding the float recommendation for the time being. However, that may change at any time.

The only other data scheduled for release this week is September’s Existing Home Sales Friday morning. This report gives us an indication of housing sector strength and mortgage credit demand. I don’t see it having much of an influence on the bond market or mortgage rates, but a reading that varies greatly from analysts’ forecasts could lead to a slight change in mortgage pricing. It is expected to show a slight increase in sales from August to September.

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: bond, bond market, bond yields, closing, existing home sales, Float, mortgage credit, mortgage rates, rate, refinancing a home, release tomorrow, stock losses, stock markets, Tuesday, unemployment claims

Rate Lock Advisory – Wednesday Sep. 17th

Rate Lock Advisory – Wednesday Sep. 17th

Wednesday’s bond market has opened in positive territory following significant losses in the stock markets. The Dow is currently down 281 points while the Nasdaq has lost 70 points. The bond market is currently up 9/32, but we will still see an extremely large increase in mortgage rates compared to yesterday’s. Overall, this morning’s rates should be approximately one full discount point higher, or a quarter of a percent in rate.

This morning’s stock weakness is a result of more concerning news in the financial sector, particularly the need for the Fed to intervene in the AIG crisis and other related issues. The stock markets managed to rally late yesterday after the Fed meeting adjourned, leading to selling in bonds that affected this morning’s mortgage pricing. Despite today’s stock weakness, the bond market cannot overcome its concerns nor erase the losses from yesterday that are helping to drive mortgage rates higher this morning.

Today’s only relevant economic news was the release of August’s Housing Starts that showed new starts for homes fell to a 17 year low last month. This was a level that was much weaker than analysts had expected. However, because this data is not considered to be of high importance to the markets, its impact on this morning’s mortgage rates has been limited.

The Labor Department will give us weekly unemployment claims tomorrow morning. They are expected to show that 440,000 new claims for benefits were filed last week. This would be a slight decline from the previous week.

Late tomorrow morning, the Conference Board will release its Leading Economic Indicators (LEI). This index attempts to measure economic activity over the next three to six months. If it estimates an increase in activity, the bond market will probably fall and mortgage rates will rise slightly. If it shows weaker than expected readings, the bond market may rally and mortgage rates should f all. Current forecasts are calling for a 0.2% decline from July’s reading.

I am still expecting to see more volatility in the markets and potentially mortgage rates. Accordingly, please maintain fairly constant contact with your mortgage professional if you have not locked an interest rate yet.

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, bond market, closing, economic activity, fed meeting, financial sector, housing starts, labor department, leading economic indicators, LEI, lock, mortgage rates, rate, stock, stock markets, unemployment claims, yesterday

Rate Lock Advisory – Wednesday Aug. 27th

Rate Lock Advisory – Wednesday Aug. 27th Wednesday’s bond market has opened in negative territory following a much larger than expected jump in durable goods orders. The stock markets are showing gains with the Dow up 62 points and the Nasdaq up 12 points. The bond market is currently down 6/3l, but we will likely see this morning’s mortgage rates improve slightly due to strength in bonds late yesterday. Yesterday’s FOMC minutes release indicated that the Fed does not feel interest rates are too low, keeping open the possibility of more rate cuts to stimulate economic activity in the future. However, this likely could only come if inflationary pressures eased enough for the Fed to feel comfortable with the move. But, the minutes did indicate a rake hike is more likely to be the next move than a possible reduction to key short-term interest rates. The Commerce Department gave us July’s Durable Goods Orders this morning, saying that new orders for big-ticket items rose 1.3% last month. This was much higher than analysts had expected and indicates that the manufacturing sector was stronger than thought last month. This is generally bad news but this data can be quite volatile from month to month so its impact on rates this morning has been fairly minimal. Thursday’s only data is the first revision to the 2nd Quarter Gross Domestic Product (GDP). Last month’s preliminary reading revealed a 1.9% pace of growth. A smaller than expected upward revision should help lower mortgage rates Thursday, especially if the inflation portion of the release does not get revised higher. Current forecasts are calling for a 2.7% annual rate. There will be a final revision issued next month, but it probably will have little impact on mortgage rates. The Labor Department will post weekly unemployment claims numbers tomorrow morning also. Analysts are expecting to see 425,000 new claims, which would be a decline from the previous week. If I we re 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: big ticket items, bond market, closing, durable goods orders, Float, fomc minutes, inflationary pressures, lock, lower mortgage, mortgage rates, negative territory, rate, unemployment claims, upward revision

Daily Rate Lock Recommendation – 08/20/2008 12:21:00 PM EST

Wednesday’s bond market has opened up slightly despite stock gains and a lack of economic news on the day’s agenda. The stock markets are showing solid gains after earlier weakness this week. The Dow is currently up 68 points and the Nasdaq up 21 points. The bond market is currently up 6/32, but we will likely see little change in this morning’s mortgage rates. There is no relevant economic news scheduled for release today. The bond market will likely be influenced by stock swings if we are to see any afternoon changes to mortgage rates today. Stocks of mortgage giants Fannie Mae and Freddie Mac have come under fire again and have posted considerable losses this week as investors become more concerned about their stability and the housing market. This could influence mortgage rates also if the fears continue to rise and should be kept on our radar. Early tomorrow morning, the Labor Department will post last week’s new unemployment claims numbers. They are expected to fall by 12,000 claims from the previous week to 438,000 new claims. A larger than expected number of claims would be considered good news for bonds and mortgage rates, however, this is not one of the more important reports we see each week. Therefore, unless the number varies greatly from forecasts its impact on rates will probably be minimal. The Conference Board will give us the last piece of monthly data for the week late tomorrow morning when it releases its Leading Economic Indicators (LEI) for July. This index attempts to measure economic activity over the next three to six months. A higher than expected reading is bad news for the bond market because it indicates that the economy may be strengthening. However, a weaker than expected reading means that the economy may slow in the near future, making stocks less appealing to investors. This also eases inflation concerns in the bond market and could lead to slightly lower mortgage rates tomorrow if the stock markets remain calm. Current forecasts are calling for a decline of 0.3% in the index. 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: bond, bond market, closing, fannie mae, fannie mae and freddie mac, Float, inflation concerns, leading economic indicators, LEI, lower mortgage, mortgage rates, stock, stock gains, stock markets, unemployment claims, week

Daily Rate Lock Recommendation – 08/13/2008 12:21:00 PM EST

Wednesday’s bond market has opened up slightly after this morning’s economic data showed no surprises. The stock markets are showing early losses with the Dow currently down 98 points and the Nasdaq down 8 points. The bond market is currently up 15/32, but we will likely see little change in this morning’s mortgage rates due to weakness in bonds late yesterday.

The Commerce Department gave us July’s Retail Sales numbers early this morning, saying that sales fell 0.1% last month. This matched forecasts and hasn’t had much of an impact on this morning’s bond trading or mortgage rates. The portion of the report that excludes more volatile auto sales showed that sales rose 0.4%, which was slightly below forecasts. That could be considered a bit of good news for bonds, but has not influenced trading as of yet.

Tomorrow morning brings us the release of July’s Consumer Price Index (CPI). The CPI is one of the most important reports we see each month since it measures inflation at the consumer level of the economy. There are two readings in the report- the overall index and the core data reading. The more important of the two is the core data because it excludes more volatile food and energy prices. Current forecasts call for an increase of 0.4% in the overall and 0.2% in the core data reading. Smaller than expected increases should lead to a bond rally and lower mortgage rates. However, stronger than expected readings will likely cause a spike in mortgage pricing.

Also tomorrow is the weekly release of new unemployment claims by the Labor Department. This release normally has little impact on the bond market or mortgage rates but due to the previous week’s spike to 455,000 claims, analysts will likely be watching this data a little closer than usual. Another increase could send bond prices higher and mortgage rates lower, assuming the CPI doesn’t reveal stronger than expected inflation readings.

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: bond, bond market, bond prices, bond trading, closing, consumer price index, core data, cpi, index cpi, lower mortgage, Release, sales numbers, unemployment claims, volatile food

Daily Rate Lock Recommendation – 07/30/2008 12:03:00 PM EST

Wednesday’s bond market has opened in negative territory again as stock extend their gains. The stock markets are showing strength yet again with the Dow up 112 points and the Nasdaq up 13 points. The bond market is currently down 7/32, which will likely keep this morning’s mortgage rates at yesterday’s levels. There is no relevant economic news scheduled for release today that is relevant to mortgage rates, but there are two reports scheduled for release tomorrow. The first is the quarterly Gross Domestic Product (GDP), which is considered to be the best indicator of economic growth. It is the sum of all goods and services produced in the U.S. and usually has a great deal of influence on the financial markets. Current forecasts are estimating a 2.3% pace. A larger increase will probably hurt bond prices, leading to higher mortgage rates. But a smaller increase would likely fuel a bond market rally. The second report of the day is the 2nd Quarter Employment Cost Index (ECI) that measures employers’ costs for wages and benefits. It is considered to be an important measurement of wage inflation and can have a pretty big impact on the bond market and mortgage rates. If it shows a rapid increase, raising inflation concerns, the bond market may drop and mortgage rates rise. It is expected to reveal an increase of 0.7%. We also will get weekly unemployment claims from the Labor Department. They are expected to say that 395,000 new claims for benefits were filed last week. This would be a decline form the previous week’s number, but this data usually is not of much importance to the markets unless it varies greatly from forecasts. 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 pl ace 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, closing, cost index, Float, inflation concerns, market rally, negative territory, quarter employment, Release, release tomorrow, stock, U.S., unemployment claims, wage inflation

Daily Rate Lock Recommendation – 05/21/2008 11:18:00 AM EST

Wednesday’s bond market has opened in negative territory as investors prepare for today’s FOMC minutes. The stock markets are posting another round of losses with the Dow down 97 points and the Nasdaq down 8 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.

There was no relevant economic news posted today. The only relevant news we really need to worry about are the minutes from the last FOMC meeting. Market participants will be looking for how Fed members voted during the last meeting and any comments about inflation concerns in the economy. The goal is to form a guess about what the Fed’s next move will be. The minutes will be released at 2:00 PM ET, so if there is a market reaction to them it will be evident during afternoon trading.

Tomorrow brings us no relevant economic data except for weekly unemployment claims from the Labor Department. T hey are expected to report that 372,000 new claims for benefits were filed last week. However, since this data tracks only a week’s worth of numbers, it likely will not influence mortgage rates unless it varies greatly from forecasts.

I would not be surprised to see stock prices continue to fall over the next few days. They seem to be reacting to high oil prices. If this is true, we should see funds shift into bonds as a safe haven, leading to improvements in mortgage rates. Accordingly, I am holding the float recommendations for short and longer periods for the time being.

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 o nly an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

Tags: bond, closing, Float, FOMC, fomc meeting, fomc minutes, inflation concerns, market participants, mortgage rates, negative territory, refinancing a home, relevant news, stock, today, unemployment claims

Daily Rate Lock Recommendation – 4/17/2008

Thursday’s bond market has opened down slightly as yesterday’s late weakness carried into this morning’s trading. The stock markets are showing losses with the Dow down 31 points and the Nasdaq down 15 points. The bond market is currently down 5/32, but weakness late yesterday will push this morning’s mortgage rates higher by approximately .375 of a discount point over yesterday’s morning rates.

Yesterday afternoon’s weakness in bonds was mostly the result a sizable stock rally, but inflation concerns that were mentioned in the Fed Beige Book also contributed. The report showed that the economy continued to weaken and that prices paid for raw materials spiked since the last report. The higher costs for materials usually means higher prices passed on to consumers. That inflation threat is a concern to bond traders because inflation erodes the value of a bond’s future fixed interest payments and leads to selling in bonds. That translates into higher mortgag e rates for borrowers.

The Conference Board said that their Leading Economic Indicators (LEI) for March, which attempts to measure economic activity over the next three to six months, rose 0.1% last month. This matched forecasts and has been a non-factor in today’s trading and mortgage pricing.

The Labor Department released weekly unemployment claims, saying that 372,000 new claims for benefits were filed. This was up form the previous week, but was close to forecasts. Therefore, it also had no impact on this morning’s rates.

There is no relevant data scheduled for release tomorrow. Look for the stock markets to be the biggest influence eon bond trading and mortgage rates. If stocks move higher, binds will likely fall and mortgage rates will inch up. If we see stock weakness, mortgage rates should improve tomorrow.

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: bond, bond traders, closing, fed beige book, Float, inflation concerns, inflation threat, leading economic indicators, LEI, refinancing a home, release tomorrow, stock, stock rally, trading, unemployment claims, weakness, yesterday