Your Daily Mortgage Commentary & Rate Lock Advice for Massachusetts Mortgage Rates
Courtesy of the Massachusetts Mortgage Broker
Friday’s bond market has opened in positive territory after this morning’s key consumer spending report showed much weaker than expected readings. The stock markets are mixed with the Dow down 24 points and the Nasdaq up 7 points. The bond market is currently up 14/32, but we will likely see an increase in this morning’s mortgage pricing of approximately .250 of a discount point due to weakness late yesterday and correspondingly higher Massachusetts mortgage rates.
The Commerce Department reported that retail-level sales fell 1.2% last month, falling well short of forecasts of a 0.2% increase. Even with more volatile auto sales excluded, we saw a decline in consumer purchases of 1.1% when a small increase was expected. This means that consumers spent much less last month than thought, raising concerns that the economic recovery may take longer than previously estimated. Since consumer spending makes up two-thirds of the U.S. economy, this surprise decline in sales is extremely good news for the bond market and Massachusetts mortgage rates.
The University of Michigan released their Index of Consumer Sentiment late this morning, announcing a reading of 75.5. This was a full point higher than expectations, indicating that consumers were more optimistic about their own financial situations this month than they were last month. However, the Retail Sales data is much more important to the markets and has influence this morning’s trading and Massachusetts mortgage rates much more than this data has.
Yesterday’s 30-year Bond auction went fairly well, but the bond market weakened late yesterday as stock prices moved higher. The Dow posted a 273-point gain yesterday, which led to bond selling and shifting of funds into stocks. Nothing drastic happened with Massachusetts mortgage rates, but it does remind us of how influential the stock markets are on bond prices and therefore, mortgage rates.
Next week brings us the release of a handful of relevant economic reports, but they include two key inflation readings that can heavily move the markets. There is no relevant data scheduled for release Monday or Tuesday, meaning the stock markets could be the biggest force behind any noticeable changes to Massachusetts mortgage rates. Look for more details on next week’s events in Sunday’s weekly preview.
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…
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 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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