April 21st, 2009 8:54 AM by Lehel Szucs
Tuesday's bond market has opened in positive territory despite gains stocks. The Dow is currently up 34 points while the Nasdaq has gained 20 points. The bond market is currently up 7/32, which with yesterday's late strength will improve this morning's mortgage rates by approximately .250 of a discount point.
There is no relevant data scheduled for release today or tomorrow, so expect to have any movement in stocks to be the driving force behind bond and mortgage rate swings. If the major stock indexes continue to rise this morning, we may see downward revisions to mortgage rates later today.
The next relevant economic data comes Thursday morning when the National Association of Realtors will post March's Existing Homes Sales. They are expected to show a drop from February's sales. The sister report to this release, March's New Home Sales will be released Friday morning. Both of these releases give us an indication of housing sector strength and mortgage credit demand, but unless they vary greatly from analysts' forecasts, I don't think they will cause much movement in mortgage rates.
We are still looking for Friday's data to cause the most movement in mortgage rates this week. It is by far more important than any of the other weekly or monthly reports being posted this week. We have seen some improvement in rates the first two days, but if Thursday's and Friday's data gives us stronger than expected results we could still close the week with rates higher than opening levels.
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 t o be in the best interest of all/any other borrowers.
©Mortgage Commentary 2009