Our Real Estate Blog

Mortgage Rates (11/19/2010)

November 20th, 2010 7:42 AM by Lehel S.

Friday’s bond market has opened in positive territory after the stock markets failed to extend yesterday’s rally. They are showing relatively minor losses with the Dow down 14 points and the Nasdaq down 2 points. The bond market is currently up 5/32, which with yesterday’s late strength should improve this morning’s mortgage rates by approximately .250 - .375 of a discount point. 

There is no relevant economic data scheduled for release today. It will be interesting to see if the markets ease into the weekend or if we will get more volatility. After such an active week in the financial and mortgage markets, I would not be surprised to see traders take a step back and exhale this afternoon. This would be welcomed news after such a roller coaster week so far, but I don’t recommend letting your guard down as we head into the weekend. 

I suspected we would see some increase in rates this week, so we started with short -term lock recommendations. However, the spike in rates that did come was an overreaction in my opinion. Therefore, I am taking a more optimistic stance toward rates, at least for the time being. I believe the risk versus reward scale of floating a rate is leaning towards the reward side. But this recommendation definitely has a short and tight leash, so please keep an eye on the markets if still floating an interest rate.

Next week has only a couple of relevant economic reports scheduled in addition to the minutes from the last FOMC meeting a two Treasury auctions that may influence mortgage rates. Worth noting though is the fact that everything is taking place the first three days of the week due to the holiday-shortened trading schedule. There is nothing of importance scheduled for Monday, 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... 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. 
Posted in:General
Posted by Lehel S. on November 20th, 2010 7:42 AM

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