Rate Lock Advisory

Friday, December 13th

Friday’s bond market initially opened in positive territory, recovering some of yesterday’s heavy losses, but has since slipped from morning highs. Stocks are extending their gains, pushing the Dow higher by 120 points and the Nasdaq up 46 points. The bond market is currently up 4/32 (1.88%), which should help recoup the intraday upward revision in rates late yesterday afternoon. This morning’s rates should be approximately .125 of a discount point worse than Thursday’s early pricing.



30 yr - 1.88%







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 30-year Bond auction actually went very well. Investor demand for the securities was stronger than we had expected. That would normally be good news and help boost bond prices and improve mortgage rates. However, the massive unexpected sell-off we saw in bonds made the auction results irrelevant. The bond market and mortgage rates worsened as the afternoon went on despite the strong auction.



Retail Sales

November's Retail Sales data was posted at 8:30 AM, revealing a 0.2% increase in consumer level sales. This was noticeably softer than the 0.5% increase that was expected, indicating consumers spent much less than many had thought. Because consumer spending makes up over two-thirds of the U.S. economy, the weaker number is good news for bonds and mortgage rates.



Geopolitical/Financial Issues

We are seeing some volatility in bonds this morning as a result of news and a press conference out of China that seem to support the announcement that progress is being made towards a trade deal with the U.S. Yesterday’s sell-off was likely an overkill, allowing bonds to recover some of those losses this morning. Now that this issue should be behind us for the time being, we hopefully will not see as much volatility on related news.




Next week brings us more economic data than this week did but compared to this week's highly important data, next week's is considered to be only moderately important. Monday has nothing scheduled, meaning we can expect weekend news and stock movement to drive bond trading and mortgage rates early next week.

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.