Rate Lock Advisory

Tuesday, September 23th

Tuesday’s bond market has opened in positive territory as investors await this afternoon’s Fed speech. Stocks are mixed with the Dow up 325 points and the Nasdaq down 57 points. The bond market is currently up 3/32 (4.13%), but weakness late yesterday is going to cause this morning’s mortgage rates to be higher than Monday’s early pricing by approximately .125 - .250 of a discount point. If you saw an intraday increase yesterday, you may not see an upward move this morning.

3/32

Bonds

30 yr - 4.13%

325

Dow

46,702

57

NASDAQ

22,731

Mortgage Rate Trend

Trailing 90 Days - National Average

  • 30 Year Fixed
  • 15 Year Fixed
  • 5/1 ARM

Indexes Affecting Rate Lock

Medium

Unknown

Fed Talk

Today doesn’t have any relevant economic data for the markets to be concerned with. However, Fed Chairman Powell is speaking at a Chamber of Commerce luncheon in Rhode Island at 12:35 PM. The topic is listed as Economic Outlook, so don’t be surprised to see the markets react to something he may say. We have been getting conflicting opinions from the Fed members since last week’s FOMC meeting regarding the likelihood of more rate cuts. His opinion may have a stronger impact than some of the speeches we have heard already.

Low

Unknown

New Home Sales

August's New Home Sales report will start this week’s economic data late tomorrow morning. It is expected to show sales of newly constructed homes declined modestly last month, but this is the week's least important report in terms of potential impact on mortgage rates. We don’t expect the data to have a noticeable impact on mortgage rates unless it differs greatly from forecasts, partly because it covers only a small portion of all home sales in the U.S. Good news for rates would be a large decline.

Medium

Unknown

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

We also have the first of this week's two potentially influential Treasury auctions taking place tomorrow. The Treasury will sell 5-year Notes tomorrow and 7-year Notes Thursday. They will tell us if there is an appetite in the markets for medium-term securities. If investor demand in these sales is strong, particularly from international buyers, the broader bond market should move higher, pushing mortgage rates slightly lower. But a lackluster interest from investors could lead to bond selling and higher mortgage pricing. The results of the sales will be announced at 1:00 PM ET each day, so any reaction will come during afternoon trading tomorrow and/or Thursday.

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.

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