Your Daily Mortgage Commentary & Rate Lock Advice for Massachusetts Mortgage Rates
Courtesy of the Massachusetts Mortgage Broker
Monday’s bond market has opened down sharply following news that the European Union has agreed to a bailout for Greece. The news has helped erase concerns about the global economy that the situation brought and fueled a stock market rally that has the Dow up over 410 points and the Nasdaq up 102 points. The bond market is currently down 33/32, which will likely push this morning’s Massachusetts mortgage rates higher by approximately .375 of a discount point.
As I mentioned a couple times last week, the recent rally in bonds was likely short-lived. The move upward for Massachusetts mortgage rates is almost always much quicker than the downward move. Today’s reversal in stocks and bonds may not be complete if we don’t get bad news from other countries. With no relevant economic data on tap tomorrow, I am expecting this afternoon’s momentum in stocks to extend into tomorrow’s morning trading. If we close the day with a bigger bond loss than we are seeing currently, the selling may push tomorrow’s bond market lower also. That would likely translate into another increase to Massachusetts mortgage rates tomorrow morning.
There are four pieces of relevant economic news scheduled for release this week in addition to two important Treasury auctions. There is no relevant data due to be posted today or tomorrow, so expect the stock markets to continue to influence bonds and Massachusetts mortgage rates until we get to the week’s important events.
March’s Goods and Services Trade Balance report will be released early Wednesday morning. This report gives us the size of the U.S. trade deficit but likely will not have much of an impact on the bond market or mortgage pricing. It is expected to show a $40.0 billion trade deficit, but it is the least important of this week’s data and likely will have little impact on Wednesday’s Massachusetts mortgage rates.
The Treasury will hold a 10-year Note sale Wednesday and a 30-year Bond sale Thursday. Results of the auctions will be posted at 1:30 PM ET each day. If they are met with a strong demand from investors, we could see bond prices rise enough during afternoon trading to cause downward revisions to Massachusetts mortgage rates. However, lackluster bidding in the sale could lead to higher mortgage pricing those afternoons.
The remaining three economic reports will be released Friday morning. This is when we will get April’s Retail Sales data (highly important), April’s Industrial Production (moderately important) and May’s University of Michigan’s Index of Consumer Sentiment (moderately important).
Overall, it likely will be another active week for Massachusetts mortgage rates. Besides the week’s important economic news, look for the stock markets to be a major influence on trading. The most important day of the week is Friday with three reports on the agenda, including the sales data. But today’s volatility does not come as a surprise and may actually end up making today the most active day of the week if Friday’s data does not reveal any significant variances.
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…
Lock if my closing was taking place between 21 and 60 days…
Lock 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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