Our Real Estate Blog

Mortgage Rates (11/26/2010)

November 27th, 2010 1:55 PM by Lehel S.

Friday’s bond market has opened in positive territory due to a weak opening in stocks. The stock markets look to be closing the week with losses as concerns about overseas financial situations take center stage again. The Dow is currently down 89 points while the Nasdaq has fallen 8 points. The bond market is currently up 12/32, which should improve this morning’s mortgage rates by approximately .125 of a discount point.

There is no relevant economic data scheduled for release today. This makes it very likely that any intra-day changes to mortgage rates will be a result of noticeable movement in stocks. If the major stock indexes extend their current losses, we could see a slight improvement in mortgage rates later today. However, a rebound in stocks would probably cause bond prices to drop and mortgage rates to revise higher. But, with an early close in the bond market today, I suspect we will see mortgage rates remain flat. 

The stock and bond markets will be closing early today as part of the holiday weekend. The markets were closed yesterday in observance of the Thanksgiving holiday. The bond market will close at 2:00 PM ET, so if there is a change to mortgage pricing later today, it will probably come before then.

Wednesday’s 7-year Treasury Note auction didn’t surprise us. It was met with a poor demand from investors, but that was expected after Tuesday’s 5-year Note sale was weak. The 10-year Note and 30-year Bond auctions will take place the week after next, which will give us a good measurement of investor demand for long-term securities. If there is poor interest in those sales also, we may see mortgage rates start to move higher again.

Next week brings us the release of several important pieces of economic data that can influence mortgage rates. There is nothing of relevance scheduled for Monday, but other days have key reports s uch as consumer confidence and manufacturer sentiment indexes along with the almighty monthly Employment report. Look for more 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... 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 to be in the best interest of all/any other borrowers. 
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Posted by Lehel S. on November 27th, 2010 1:55 PM

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