Rate Lock Advisory

Friday, October 9th

Friday’s bond market has opened slightly in negative territory, extending yesterday’s negative momentum. The stock markets are showing minor gains during early trading after rallying from early losses yesterday to close well in positive ground. The Dow is currently up 41 points while the Nasdaq is up 12 points. The bond market is currently down 2/32 (2.10%), which should push this morning’s mortgage rates higher by approximately .125 of a discount point if comparing to Thursday’s morning pricing.



30 yr - 2.10%







Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock



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

We saw weakness in bonds late yesterday that resulted in rate increases from many lenders. The cause wasn’t the 30-year Bond auction as it went pretty well. Most of the benchmarks we use to gauge investor demand showed a decent level of interest in the securities. We did not exactly get a positive reaction in bonds, but it also was not the reason bonds weakened.



Federal Open Market Committee (FOMC) Minutes

The bond market did eventually react negatively to the minutes of the most recent FOMC meeting that were released at 2:00 PM ET yesterday. This is because they indicated that while global economic issues are a concern to our economy, most Fed members felt they were still ready to start raising key short-term interest rates either now or in the near future. It is worth noting though that this FOMC meeting took place BEFORE September’s disappointing and concerning Employment report was released. The next FOMC meeting is set for the 27th and 28th of this month, so it will be interesting to see if those numbers altered the Fed’s thought process. I personally believe they will change some members’ opinions and that no rate hike will come at this month’s meeting. December’s meeting or early next year is a more likely option in my opinion.




There is nothing scheduled for release today that is expected to influence bond trading or mortgage rates. If we see an intraday change in rates, it will probably be due to a noticeable move in stocks. If the major stock indexes remain near their current levels, I suspect mortgage rates will do the same.




Monday is Columbus Day. The bond market will be closed as will banks but the stock markets will be open for trading. Next week brings us the release of several important economic reports, although all of the relevant reports are set for release the second half. Look for details on next week’s calendar and scheduled events in Sunday evening’s weekly preview.

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... 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.