Rate Lock Advisory

Tuesday, May 7th

Tuesday’s bond market has opened in positive territory again, erasing weakness from late yesterday. Stocks are continuing their recent rally with the Dow up 115 points and the Nasdaq up 7 points. The bond market is currently up 12/32 (4.43%), but selling late yesterday is going to limit this morning’s improvement in rates to just a slight change. If you saw an intraday increase in rates yesterday afternoon, you should see an improvement of approximately .125 - .250 of a discount point this morning.

12/32

Bonds

30 yr - 4.43%

115

Dow

38,968

7

NASDAQ

16,356

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 again nothing of importance scheduled for release today that is expected to have an impact on mortgage rates. We are seeing the positive momentum in bonds extend into this morning’s session. With little driving this morning’s move, there is a decent chance of seeing a reversal again this afternoon.

Medium

Unknown

Treasury Auctions (5,7,10,20,30 year)

Tomorrow also lacks a relevant economic release, but does have an afternoon event that is likely to influence bond trading and, quite possibly, mortgage rates. 10-year Notes will be auctioned tomorrow with results posted at 1:00 PM ET. If the sale is met with a strong demand from investors, we could see bond prices rise enough during afternoon trading to cause a downward revision to mortgage rates. However, lackluster bidding in the sales, meaning longer-term securities are losing their appeal, could lead to higher mortgage pricing during afternoon trading tomorrow.

Medium

Unknown

Fed Talk

We also have three scheduled Fed speeches taking place tomorrow. None of the topics appear likely to yield a strong reaction in the markets. However, as with all speeches by current Fed members, there is the possibly of hearing something unexpected that draws a reaction. Two are set for 11:30 and 11:45AM. The third is scheduled for 1:30 PM ET.

Float / Lock Recommendation

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.