Rate Lock Advisory

Monday, August 29th

Monday’s bond market has opened in positive territory, recovering some of Friday’s late losses. The stock markets are also starting the week in positive ground with the Dow up 89 points and the Nasdaq up 11 points. The bond market is currently up 10/32 (1.59%), but due to heavy selling late Friday, we still will see an increase of approximately .125 of a discount point in this morning’s mortgage rates if comparing to Friday’s early pricing. If your lender did revise higher late Friday, your increase may be less this morning or possibly even a slight improvement, depending on how much of an intra-day revision was made.

10/32


Bonds


30 yr - 1.59%

89


Dow


18,485

11


NASDAQ


5,230

Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock

Medium


Neutral


Personal Income and Outlays

July's Personal Income and Outlays report was posted early this morning, revealing a 0.4% rise in income and a 0.3% increase in spending. Both readings indicate moderate economic growth but also matched forecasts. Because there was no surprise in the data, it has had little effect on this morning’s mortgage rates.

Medium


Unknown


Consumer Confidence Index (Conference Board)

The rest of the week brings us six more pieces of economic data for the markets to digest, including a couple of extremely important reports. The first of those remaining reports will come from the Conference Board, who will post their Consumer Confidence Index (CCI) for August at 10:00 AM ET tomorrow morning. This index measures consumer sentiment about their personal financial and employment situations, giving us a measurement of consumer willingness to spend. A decline in confidence would indicate that surveyed consumers probably will not make a large purchase in the immediate future. That would be a sign of economic weakness and should drive bond prices higher, leading to lower mortgage rates tomorrow. It is expected to show a reading of 97.0, which would be a small decline from July's 97.3. The lower the reading, the better the news for bonds and mortgage pricing.

Medium


Unknown


None

Overall, Friday is likely to be the most important day for mortgage rates due to the Employment report but Thursday could also be pretty active with the ISM manufacturing index being released. The best candidate for calmest day is Wednesday, assuming that the ADP employment release shows no surprises. Tomorrow could also be one of the calmer days of the week. However, I believe we are in for an active week in the financial and mortgage markets. Therefore, please proceed carefully if still floating an interest rate and closing in the near future.

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... Lock 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.