Your Daily Mortgage Commentary & Rate Lock Advice for Massachusetts Mortgage Rates
Courtesy of the Massachusetts Mortgage Broker
None of this morning’s economic data can be considered favorable to the bond market or Massachusetts mortgage rates. The big news was March’s Producer Price Index (PPI) that showed a 0.7% increase in the overall index and a 0.1% rise in the more important core data. The 0.7% reading was higher than expected, meaning prices at the producer level of the economy rose more than thought. That raises concerns because the costs usually have to be passed on to the consumer, fueling inflation. However, the core data reading that excludes more volatile food and energy prices matched forecasts, preventing bond selling. Therefore, we can consider this data to be fairly neutral for Massachusetts mortgage rates.
The Labor Department said that new claims for unemployment benefits did fall last week as they were expected to do. The 456,000 new claims were a little higher than what analysts had forecast, but since it was still a sizable drop from the previous week’s total of 480,000 claims this data has not impacted this morning’s Massachusetts mortgage rates.
The National Association of Realtors said late this morning that home resales rose 6.8% last month, exceeding expectations. This means that the housing sector was stronger than thought, which is negative news for bonds and Massachusetts mortgage rates. It is widely believed that the overall economy will not be able to really strengthen and maintain its recovery if the housing sector has not stabilized. So, we can consider this data negative for bonds also, but it is not considered to be a highly important report. This means it has had little influence on this morning’s mortgage rates also.
March’s Durable Goods Orders will be released early tomorrow morning. It gives us an indication of manufacturing sector strength by tracking orders for big-ticket items at U.S. factories. These are products with a life expectancy of at least three years. Current forecasts are calling for an increase in new orders of 0.2%. This would be a sign of slight manufacturing sector growth, but this data can be quite volatile from month-to-month. Therefore, a small variance between forecasts and the actual results will not heavily influence the markets or Massachusetts mortgage rates. A decline would be considered good news, while a large increase would indicate manufacturing sector strength. Ideally, the mortgage market would like to see a sizable decline in new orders.
Also tomorrow is the release of March’s New Home Sales report. This data is similar to today’s housing release except it covers the remaining 15% of home sales that today’s does not. It is expected to show an increase in sales of newly constructed homes. As with today’s Existing Home Sales report, I don’t see Massachusetts mortgage rates having much of a reaction to its results.
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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