Your Daily Mortgage Commentary & Rate Lock Advice for Massachusetts Mortgage Rates
Courtesy of the Massachusetts Mortgage Broker
Thursday’s bond market has opened up sharply following another round of significant selling in stocks. The stock markets are reacting to more concerns about the global economy and financial issues, causing the Dow to lose 227 points and the Nasdaq to fall 68 points. The bond market is currently up 34/32, which should improve this morning’s Massachusetts mortgage rates by approximately .375 – .500 of a discount point.
Today’s economic data was bond favorable, but neither release is considered to be highly important to the markets. The first was weekly unemployment claims from the Labor Department. They announced that 471,000 new claims for unemployment benefits were filed last week, exceeding forecasts of 439,000 by a wide margin. This raises concerns about the employment sector, but since this data tracks only a single week’s worth of new claims its impact on Massachusetts mortgage rates is minimal.
Posted late this morning was April’s Leading Economic Indicators (LEI) that showed a 0.1% decline when it was expected to rise 0.2%. This means that the index is predicting economic activity to slow during the next couple of months. That is good news for bonds and Massachusetts mortgage rates if it proves to be accurate.
Yesterday afternoon’s release of the FOMC minutes did give us some new insight into the Fed’s thinking and predictions. They revised their expectations for economic growth upward and the unemployment rate downward from previous estimates. Those revisions indicate that the Fed feels the economy will be stronger this year and that the employment sector will strengthen earlier than previously thought. Both can be considered negative news for bonds and Massachusettsmortgage rates as many believe that once the economy gains some traction, inflation will become a serious threat. And bond traders hate to hear the “I” word. But, the news was taken in stride as the overseas concerns are in the forefront for the time being.
There is no relevant data scheduled for release tomorrow, leaving the stock markets the opportunity to be the biggest influence on bond trading and Massachusetts mortgage rates. If they continue to move lower, bonds should remain in positive territory and mortgage rates could improve again. But if the major stock indexes are able to rebound, I suspect we will see funds moved from the bond market, causing bonds to fall and mortgage rates to rise.
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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