Rate Lock Advisory

Thursday, March 30th

Thursday’s bond market has opened in negative territory, erasing yesterday’s improvements. Stocks are showing moderate gains again, pushing the Dow higher by 59 points and the Nasdaq higher by 10 points. The bond market is currently down 6/32 (2.40%), but strength late yesterday should keep this morning’s mortgage rates very close to Wednesday’s morning levels. If your lender revised lower intraday yesterday, you should see an increase in this morning’s pricing by the same amount.



30 yr - 2.40%







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)

Yesterday’s 7-year Treasury Note auction went very well with the indicators pointing towards a pretty strong level of investor interest. Bonds didn’t have a significant reaction to the news, but we did see many lenders make a downward revision to their pricing shortly after results were posted.



GDP Rev 2 (month after Rev 1)

This morning’s minor economic releases gave us mixed results. The second revision to the 4th Quarter Gross Domestic Product (GDP) showed the economy grew at a 2.1% annual pace, a little higher than the previous estimate of 1.9% and slightly above the 2.0% that was forecasted. The higher reading is bad news for bonds because it means economic activity was stronger than thought at the end of last year. That said, it really isn’t having too much of an impact on today’s mortgage rates due to the age of the data and the fact that the current quarter’s reading will be posted next month.



Weekly Unemployment Claims (every Thursday)

The second release of the morning gave us favorable results. Last week's unemployment figures showed that 258,000 new claims for unemployment benefits were filed. That was a decline from the previous week’s 261,000. However, analysts were calling for 245,000 initial filings. The higher than expected number allows us to label this data as good news for bonds and mortgage rates. Unfortunately, this is only a weekly report, so it did not carry enough significance to offset the morning negative tone in bonds.



Personal Income and Outlays

Tomorrow closes the week with two more economic reports that may influence mortgage pricing. February's Personal Income & Outlays report is the first, coming at 8:30 AM ET. This data helps us measure consumers' ability to spend and current spending habits, which is important to the mortgage market because of the influence that consumer spending related information has on the financial markets. If a consumers' income is rising, they are more likely to make additional purchases in the near future. Therefore, weaker than expected readings would be good news for bonds and mortgage rates. Analysts are currently calling for a 0.4% rise in income and a 0.2% increase in spending.



University of Michigan Consumer Sentiment (Rev)

The second report will come from the University of Michigan just before 10:00 AM ET. Their revised March Consumer Sentiment Index will give us another indication of consumer confidence, which hints at consumers' willingness to spend. Rising confidence is considered bad news for the bond market and mortgage pricing because it usually means consumers are more willing to spend. Tomorrow's report is expected to show a reading of 97.6, unchanged from the preliminary reading posted two weeks ago. Favorable results for bonds and mortgage rates would be a sizable decline in confidence.

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.