Rate Lock Advisory

Tuesday, October 4th

Tuesday’s bond market has opened well in positive territory as yesterday’s rebound rally continues today. Stocks are also showing big gains, pushing the Dow up 729 points and the Nasdaq up 345 points. The bond market is currently up 16/32 (3.58%), which should improve this morning’s mortgage rates by approximately .375 of a discount point if compared to Monday’s early pricing. Bonds lost ground late yesterday, causing some lenders to revise pricing higher before closing. If you saw an intraday increase yesterday, you may see a larger improvement this morning than those who did not.



30 yr - 3.58%







Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock



Factory Orders

This morning’s moderately important economic report was August's Factory Orders data at 10:00 AM ET. The Commerce Department said new orders at U.S. factories were unchanged from July’s levels. Analysts were expecting to see a 0.3% rise in orders in durable and non-durable goods. The weaker reading is a sign the manufacturing sector was softer than thought, making the data good news for rates.



ADP Employment

September's ADP Employment report will be posted early tomorrow morning. This report tracks changes in private-sector jobs, using ADP's payroll processing clients as a base. However, it is not accurate in predicting results of the monthly government report that follows a couple days later. Still, because we have seen reactions to the report, we should be watching it. Analysts are expecting it to show that 200,000 new payrolls were added. Good news for mortgage rates would be a noticeably smaller increase.



Inflation News

Also worth noting about tomorrow is the OPEC meeting. This is where the 13 oil producing member nations set output quotas, directly impacting the global oil supply. Raising production quotas means there is more oil available in the marketplace and should lower gas and other energy costs, easing inflationary pressures-particularly at the pump. On the other hand, if they lower output, we will likely see crude oil prices rise, translating into higher fuel costs and more inflation fears that make bonds less attractive to investors. The latter would lead to higher mortgage rates.

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.