Rate Lock Advisory

Thursday, October 8th

Thursday’s bond market has opened relatively flat with stocks showing minor losses and no major data being released to drive trading either way. The Dow is currently down 20 points while the Nasdaq has lost 20 points. The bond market is currently down 1/32 (2.06%), which should keep this morning’s mortgage rates at yesterday’s levels.



30 yr - 2.06%







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 10-year Treasury Note auction went fairly well with most of the benchmarks we use to gauge investor demand showing above average interest. We saw some bond movement late yesterday, but not enough to cause lenders to improve rates intraday. Although, that sale helps us to remain optimistic about today’s 30-year Bond auction. If investor demand is similar to or better than yesterday’s sale, we may see a minor improvement to mortgage rates this afternoon. Results will be posted at 1:00 PM ET, so look for a reaction during early afternoon trading.



Weekly Unemployment Claims (every Thursday)

Last week’s unemployment figures were posted early this morning, revealing 263,000 new filings. This was a decline from the previous week’s revised total of 276,000 initial claims for benefits and softer than the 275,000 that was predicted. The decline indicates that the employment sector may have strengthened last week, technically making the data bad news for bonds and mortgage rates. However, since this is only a weekly snapshot the results have had little impact on this morning’s pricing.



Federal Open Market Committee (FOMC) Minutes

We also have the minutes from last month’s FOMC meeting to watch, but they won’t come until 2:00 PM ET. These may move the markets or could be a non-factor, depending on what they say. With little else being posted this week they will likely be a little more influential than usual. The key points traders are looking for are concerns over our domestic and the global economies, inflation and the Fed's next monetary policy move. If Fed members were concerned about the economy continuing to grow, we may see the bond market move higher and mortgage rates lower this afternoon. It will be interesting to see how much debate and disagreement amongst members took place during the meeting, particularly about when they will start raising key short-term interest rates. It is worth noting though that the last FOMC meeting was followed by revised economic predications and a press conference with Fed Chair Yellen. Therefore, the likelihood of seeing a significant surprise in the minutes is relatively low.




Tomorrow has nothing of importance or relevance to the mortgage market. This likely means we will see bonds react to stock movement. Generally speaking, stock strength usually puts pressure on bonds and leads to an increase in mortgage rates. On the other hand, stock selling often translates into bond gains and lower mortgage rates. But unless something drastic and unexpected takes place, I suspect it will be a fairly calm day tomorrow.

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.