Rate Lock Advisory

Thursday, November 21th

Thursday’s bond market has opened in negative territory despite uneventful economic news and early stock losses. The Dow is currently down 84 points while the Nasdaq has lost 32 points. The bond market is currently down 4/32 (1.75%), but a little strength late yesterday could cause a slight improvement in mortgage pricing this morning. At the very least, we should see no change this morning.



30 yr - 1.75%







Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock



Federal Open Market Committee (FOMC) Minutes

Yesterday afternoon’s release of the FOMC meeting minutes failed to give us any big surprises. There seems to be a strong consensus amongst Fed members that there is no need to make more rate cuts in the near future. They believe the last cut would be sufficient to allow the economy to grow at a preferred pace while keeping inflation in check. There were concerns noted about the strength of the global economy, but they don’t believe another rate cut will be needed unless conditions deteriorate. The minutes repeated what was already said in the post-meeting statement, Chairman Powell’s press conference and congressional appearance. The lack of surprise prevented the release from having an impact on mortgage rates.



Existing Home Sales from National Assoc of Realtors

The National Association of Realtors gave us their Existing Home Sales report late this morning, announcing a 1.9% rise in home resales. The increase means the housing sector strengthened last month. However, the increase was softer than expected- hinting that housing is not as strong as thought. That allows us to consider the data neutral for mortgage rates and has prevented an increase in this morning’s rates.



Leading Economic Indicators (LEI) from the Conference Board

October’s Leading Economic Indicators (LEI) report was also released at 10:00 AM ET today. The Conference Board announced a 0.1% decline, matching forecasts. These indicators attempt to predict economic activity over the next several months, so the decline in welcomed in the bond and mortgage markets. But because this is only a moderately important release that pegged expectations, we have not seen a reaction in mortgage pricing.



University of Michigan Consumer Sentiment (Rev)

The final report of the week will be posted at 10:00 AM ET tomorrow. This will be the revised University of Michigan Index of Consumer Sentiment for November. Current forecasts are calling for little change from the 95.7 preliminary reading two weeks ago, meaning surveyed consumers felt nearly the same about their own financial and employment situations as they did earlier in the month. Bond traders would prefer to see a decline because waning confidence usually means consumers are less likely to make a large purchase in the near future, restricting economic growth. As long as we don't see a large upward or downward move, the report will likely have a minimal impact on rates.

Float / Lock Recommendation

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.