Rate Lock Advisory

Thursday, July 20th

Thursday’s bond market has opened in positive territory even though today’s only economic data showed unfavorable results. The major stock indexes are posting minor losses during early trading with the Dow down 38 points and the Nasdaq down 10 points. The bond market is currently up 5/32 (2.25%), which should keep this morning’s mortgage rates at yesterday’s levels.

5/32


Bonds


30 yr - 2.25%

38


Dow


21,602

10


NASDAQ


6,374

Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock

Low


Negative


Weekly Unemployment Claims (every Thursday)

Last week’s unemployment figures were posted at 8:30 AM ET this morning, revealing that 233,000 new claims for unemployment benefits were filed. This was a noticeable decline from the previous week’s revised 248,000 initial claims and lower than the 245,000 that was expected. That indicates the employment sector was stronger than thought last week, making the data negative for bonds and mortgage rates. However, this is only a weekly snapshot. Therefore, we are not seeing much of a reaction in the markets.

Low


Negative


Leading Economic Indicators (LEI) from the Conference Board

The Conference Board gave us June's Leading Economic Indicators (LEI) at 10:00 AM ET. It showed a 0.6% increase, exceeding forecasts of a 0.4% rise. The increase means the indicators are predicting growth in the economy over the next several months. Fortunately, this is also a minor release, preventing much of an impact on this morning’s mortgage rates.

Low


Unknown


None

Tomorrow has nothing of importance scheduled for release. If we see a move in mortgage rates it likely will be a result of stock gains or losses. Generally speaking, stock gains usually translates into bond weakness and an upward move in mortgage rates. On the other hand, losses in stocks should push mortgage rates lower.

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.