Your Daily Mortgage Commentary & Rate Lock Advice for Massachusetts Mortgage Rates
Courtesy of the Massachusetts Mortgage Broker
Friday’s bond market has opened well in positive territory after this morning’s Employment report revealed a surprise that was favorable to bonds. The stock markets have reacted negatively to the same data, bringing the Dow down 169 points and the Nasdaq down 28 points. The bond market is currently up 28/32, which should improve this morning’s Massachusetts mortgage rates by approximately .250 – .375 of a discount point.
The Labor Department gave us today’s data. They posted May’s employment numbers early this morning, announcing an unemployment rate of 9.7% and that 431,000 new jobs were added to the economy last month. The 9.7% was slightly lower than the 9.8% that was expected and can be considered negative for Massachusetts mortgage rates, but the decline is being attributed more to people giving up on the effort to find another job than it is of fewer laid-off workers. This allows the payroll number to take center stage this morning.
The 431,000 new jobs were below forecasts of 500,000, indicating that the labor market was not as strong as thought. But even bigger news was the fact that 411,000 of those jobs were temporary Census workers, meaning only a net of 20,000 new permanent jobs were filled last month. That points towards weak growth in the labor market, which is certainly good news for the bond market and Massachusetts mortgage rates.
The third important reading of the report is worth mentioning even though it has not drawn the interest of market participants. The average hourly earnings reading within the report revealed a 0.3% increase. This means that average earnings rose much quicker than the 0.1% that was expected. Without the surprise in the payroll number, this reading likely would have influenced trading negatively for Massachusetts mortgage rates because it hints at wage inflation that can significantly affect concerns about broader inflation and the economy. It will likely be watched closely next month for another sizable increase.
Next week is light in terms of the number of economic reports scheduled for release. There is no relevant news or data scheduled for release until Wednesday afternoon. One of the week’s few reports is considered to be highly important, but it will be posted the later part. Look for more details on next week’s events in Sunday’s weekly preview of Massachusetts mortgage rates.
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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