Your Daily Mortgage Commentary & Rate Lock Advice for Massachusetts Mortgage Rates
Courtesy of the Massachusetts Mortgage Broker
Tuesday’s bond market has opened in negative territory despite weaker than expected economic news and an uneventful morning in stocks. The major stock indexes are mixed with the Dow up 6 points and the Nasdaq down 4 points. The bond market is currently down 9/32, which will likely push this morning’s Massachusetts mortgage rates higher by approximately .125 of a discount point.
July’s Consumer Confidence Index (CCI) was released late this morning, revealing a 50.4 reading. This was a sizable drop from June’s reading, its’ lowest since February and weaker than analysts’ expectations. That is good news for bonds and Massachusetts mortgage rates because declining confidence means consumers are less likely to make large purchases in the near future. However, it appears that the markets are not allowing this morning’s trading to be influenced by the news.
This morning’s bond losses have pushed the benchmark yield of the 10-year Treasury Note back above 3.00%. If it remains there, I believe we are in for more bond selling and higher mortgage rates. We have plenty of relevant data still to come this week that can heavily move the markets and bring the yield below that threshold. That is assuming that we get favorable results from the report though. I am not too concerned about the 3.03% yield, but it does cause me to take a slightly more cautious approach towards Massachusetts mortgage rates.
Tomorrow brings us two events that are relevant to mortgage rates. The first will come from the Commerce Department when they post June’s Durable Goods Orders at 8:30 AM ET. Current forecasts are currently calling for an increase in new orders of 0.6% from May to June. This data gives us an indication of manufacturing sector strength by tracking orders at U.S. factories for big-ticket items, or products that are expected to last three or more years. A stronger than expected number may lead to higher mortgage rates Wednesday morning. If it reveals a much smaller than expected increase, mortgage rates should drop. It should be noted though that this data is known to be extremely volatile from month to month, so a minor difference between forecasts and the actual reading may not move Massachusetts mortgage rates much.
The Federal Reserve will release its Beige Book report at 2:00 PM ET tomorrow afternoon. This report is named simply after the color of its cover, but it is considered to be important to the Fed when determining monetary policy during their FOMC meetings. It details economic activity and conditions by region throughout the U.S. Since Fed Chairman Ben Bernanke’s testimony to Congress last week gave us a recent update, I don’t think we will see any significant surprises in this report. Therefore, we will likely see little movement in Massachusetts mortgage rates tomorrow afternoon as a result of this report.
If I were considering purchasing or refinancing a home and predicting likely Massachusetts mortgage rates, 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 a general opinion of what I would do if I were considering whether to lock or float a Massachusetts mortgage based on the current mortgage market. Your individual situation may be different. Contact me if you would like advice for your particular circumstances.
Copyright : Mortgage Commentary
Geof McLaughlin, better known as The Massachusetts Mortgage Broker, is a nationally acclaimed mortgage professional committed to educating and empowering consumers about all things mortgage through his popular Massachusetts Mortgage Broker blog.
Geof is a top loan originator for one of the country’s leading mortgage companies, Mortgage Master Inc, with a proven reputation of offering its clients the best Massachusetts mortgage rates and lowest closing costs. He can be reached directly at 508.656.0055 or at geof@MAMortgageBroker.com.
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