Our Real Estate Blog

Mortgage Rates (12/9/2010)

December 10th, 2010 8:47 AM by Lehel S.

Thursday’s bond market has opened in positive territory as investors appear to have halted the selling. The stock markets are mixed with the Dow down 5 points and the Nasdaq up 6 points. The bond market is currently up 15/32, which should improve this morning’s mortgage rates by approximately .250 of a discount point.

This morning’s only semi-relevant economic data came from the Labor Department who reported that 421,000 new claims for unemployment benefits were filed last week. This was a decline from the previous week and lower than what analysts were expecting. That indicates the employment sector was a little stronger than thought last week, but since this report tracks only a single week’s worth of new claims, it has had minimal impact on today’s trading or mortgage rates.

We do have the 30-year Bond auction to watch today. Results of the sale will be posted at 1:00 PM ET. Yesterday ’s 10-year Note sale went a little better than expected, meaning we could see some interest in today’s sale also. If investor demand was strong, we may see bond prices improve and mortgage rates move lower this afternoon.

October’s Goods and Services Trade Balance report will be posted early tomorrow morning. This report gives us the size of the U.S. trade deficit, but it is not considered to be highly important to mortgage rates. It is expected to show a $44.4 billion trade deficit, but unless it varies greatly from forecasts, I don’t expect this data to affect mortgage pricing tomorrow.

December’s preliminary reading to the University of Michigan’s Index of Consumer Sentiment is also due tomorrow morning. This index measures consumer willingness to spend and can usually have enough of an impact on the financial markets to change mortgage rates slightly. It is expected to show a reading of 72.5, which would be an in crease from last month’s final reading. The smaller the reading, the better the news for bonds and mortgage rates because waning confidence means consumers are less apt to make large purchases in the near future.

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. 
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Posted by Lehel S. on December 10th, 2010 8:47 AM



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