Rate Lock Advisory

Thursday, March 22th

Thursday’s bond market has opened in positive territory as stocks are in selling mode. The major stock indexes are showing sizable losses, pushing the Dow lower by 253 points and the Nasdaq down 65 points. The bond market is currently up 17/32 (2.81%), which should improve this morning’s mortgage rates by slightly more than .250 of a discount point if comparing to Wednesday’s morning pricing. Some lenders revised rates lower before the end of the day yesterday. If yours did, then you should see less of an improvement this morning.



30 yr - 2.81%







Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock



Weekly Unemployment Claims (every Thursday)

The first of this morning’s two minor economic releases was last week’s unemployment figures that showed 229,000 new claims for unemployment benefits were filed last week. This was an increase from the previous week’s 226,000, hinting at a softening employment sector. Unfortunately, this is only a weekly snapshot that doesn’t carry a high level of importance. In other words, it hasn’t had much of an influence on this morning’s mortgage pricing.



Leading Economic Indicators (LEI) from the Conference Board

Also posted this morning but at 10:00 AM was February’s Leading Economic Indicators (LEI). The Conference Board announced a 0.6% rise in their LEI, slightly exceeding expectations. The increase means the indicators are predicting moderate economic growth over the next several months. However, the bond market doesn’t seem to be concerned with the news. We saw no reaction to it when it was posted.



Durable Goods Orders

Tomorrow has two reports set for release with one being much more important than the other. The important data is February's Durable Goods Orders at 8:30 AM ET. This Commerce Department report gives us a measurement of manufacturing sector strength by tracking new orders for big-ticket items, or products that are expected to last three or more years such as electronics, appliances and airplanes. This data is known to be volatile from month to month but is still considered to be of high importance to the markets. Analysts are expecting it to show an increase in new orders of approximately 1.5%. A larger increase in orders would be considered negative for bonds as it would indicate strength in the manufacturing sector and could lead to higher mortgage rates. Since these orders are volatile from month to month, it will take a wider variance from forecasts for it to move mortgage rates than other data requires.



New Home Sales

The week’s calendar closes with February's New Home Sales figures at 10:00 AM ET tomorrow. The Commerce Department is expected to announce an increase in sales of newly constructed homes. This report tracks a much smaller percentage of home sales than Wednesday's Existing Home Sales report covers, so it should have a much weaker influence on the markets and mortgage pricing. A large increase in sales would be negative for the bond market and mortgage pricing because it would point towards economic strength.

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.