Rate Lock Advisory

Monday, March 18th

Monday’s bond market has opened down slightly as the new weeks begins. The major stock indexes are starting it with gains of 16 points in the Dow and 40 points in the Nasdaq. The bond market is currently down 2/32 (2.59%), which should keep this morning’s mortgage rates close to Friday’s early pricing.

2/32

Bonds

30 yr - 2.59%

16

Dow

25,865

40

NASDAQ

7,729

Mortgage Rate Trend

Trailing 90 Days - National Average

  • 30 Year Fixed
  • 15 Year Fixed
  • 5/1 ARM

Indexes Affecting Rate Lock

Medium

Unknown

None

There is no relevant economic data being released or other mortgage-related events taking place today, the only day of the week with nothing scheduled. The rest of the week brings us the release of only three monthly reports for the markets to digest, none of which are considered to be highly important. However, we do have another FOMC meeting, economic predictions and press conference to deal with mid-week.

Medium

Unknown

Factory Orders

January's Factory Orders report will start the week’s activities at 10:00 AM ET tomorrow. This report will give us a measurement of manufacturing sector strength by tracking new orders at U.S. factories for both durable and non-durable goods. Current forecasts are calling for an increase of 0.2% in new orders. A decline would be good news for the bond market and could lead to an improvement in mortgage rates since it would point towards economic weakness. However, it usually takes a large variance from forecasts for this report to affect mortgage rates noticeably because a significant portion of this data was already posted in last week's Durable Goods Orders release.

Medium

Positive

Bond Trends

Overall, Wednesday is the most important day of the week due to the FOMC items. There are no other key events this week, so we should see the most movement in rates mid-week. The calmest day could be tomorrow or today. I don’t believe we will see an overly active week for rates, but the potential is there. The benchmark 10-year Treasury Note yield is currently near its lowest level since early January . Before then, we have to go back to January of last year to find this level. There appears to be more room for yields to fall, assuming we don’t get significantly unfavorable news in the immediate future. That would be good news for mortgage shoppers since rates tend to track bond yields. However, please proceed cautiously if still floating an interest rate and closing soon as market momentum can swing without notice.

Float / Lock Recommendation

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.