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James Brooks

Mortgage Rates Continue To Move Lower 9-23-2014

Tuesday, September 23, 2014 - Article by: James Brooks - Polaris Home Funding Corp - Message

By James Brooks

The bond market is currently up 6/32 (2.55%), which should improve today's mortgage rates slightly if comparing to yesterday's mortgage rates.

There is nothing of relevance scheduled for today that is expected have an impact on mortgage rates. If we see an intra-day revision to rates, it will likely be a result of a noticeable move in stocks. If the major stock indexes move into positive ground, we could see bond prices fall and mortgage rates move higher later today. On the other hand, if they extend their current losses, we could see an improvement to mortgage rates follow.

August's New Home Sales will be released late tomorrow morning. The Commerce Department is expected to say that sales of newly constructed homes rose last month, indicating strength in the new home portion of the housing sector also. This report will likely not have a noticeable impact on mortgage rates unless its readings differ greatly from forecasts. It is the week's least important report in terms of potential impact on mortgage rates, partly because it covers only the small portion of all homes sales that yesterday's Existing Home Sales report did not.

Also tomorrow is the first of this week's two Treasury auctions that have the potential to affect rates. The Treasury will sell 5-year Notes tomorrow and 7-year Notes Thursday. They will tell us if there is an appetite in the markets for medium-term securities. If investor demand in these sales is strong, particularly from international buyers, the broader bond market should move higher, pushing mortgage rates lower. But a lackluster interest from investors could lead to bond selling and higher mortgage pricing. The results of the sales will be announced at 1:00 PM ET each day, so any reaction will come during early afternoon trading tomorrow.

If I were considering financing/refinancing a home, 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.

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