Professional Home Staging and Photography Blog: The Daily Mortgage Interest Rate Lock Advisory - July 8, 2009

The Daily Mortgage Interest Rate Lock Advisory - July 8, 2009

What the Mortgage Backed Securities Market is Doing Today:

The FNMA 30-Year 4.5% MBS opened relatively flat at up 2/32 this morning to 100.44 as traders await the results of the auction of the 10 year Treasury Note this afternoon.

The price of the FNMA 30-Year 4.5% coupon closed up 9/32 yesterday at 100.38 (as shown by the white line). MBS opened up another 2/32 this morning, but is currently trading down 1/32 at 100.36 (as shown by the blue line). Remember, on mortgage backed securities (MBSs), as the price goes up, the yield goes down - and mortgage interest rates go down with it. I expect that mortgage rates will generally be the same in price this morning as compared to yesterday.

Economic Reports for Today:

  • There are no economic reports scheduled for release today.

Important News of the Day:

As there are no economic reports due out today, the markets will focus on corporate earnings reports being released today. In addition, the Treasury Dept. will be auctioning $18 billion in 10-year Treasury notes early this afternoon. If there is a relatively strong demand for these notes, it should have a positive impact on prices of mortgages backed securities and lead to improved pricing for mortgage rates this afternoon.

There are only three monthly economic reports scheduled for release the latter part of this week. While the unemployment report may have some impact, none of the scheduled reports are expected to have a major impact on prices of bonds or mortgage backed securities this week. The markets will be impacted more by the Treasury auctions and corporate earnings reports this week. Look for more details on this week's economic data releases and events on my Weekly Mortgage Market Watch at

What's Happening With Mortgage Rates Today:

Moderate to High Volatility. Overall, I am expecting to see a fairly active week in mortgage rates. I suspect that stocks may continue their selling trend this week which will help prices of bonds increase and mortgage rates fall. However, if this week's sales of Treasury notes and bonds are met with a lackluster demand, and if corporate earnings reports come in higher than expected, then mortgage rates will most likely rise and end the week higher than last week's closing levels.

In addition, the spring and summer home buying season is upon us. Mortgage rates historically climb this time of year before peaking in July or August. If you haven't locked in a rate yet, then you may want to consider doing so. Locking is making more sense in the short term right now as the markets position themselves for the next wave of government debt auctions next week. The ever increasing massive government debt and fears of inflationary pressures could soon drive mortgage rates up again.

So, if you like the rate that you are being offered today, then there's nothing wrong with locking in. Otherwise keep an eye on the markets and maintain contact with your mortgage professional. The markets can change at any moment.

My Interest Rate Lock Advice for Today:

If I were considering financing/refinancing a home, I would...

  • Lock if my closing was taking place within 7 days
  • Float if my closing was taking place within 8 and 30 days
  • Float if my closing was taking place between 31 and 60 days
  • Float if my closing was taking place over 60 days from now

This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of any or all other borrowers. See today's mortgage rates at


East Bridgewater, MA 02333
Phone: (508) 443-1332

Lew Corcoran, ASP®, IAHSP, IAHSP-CB
Accredited Home Staging Professional
Professional Real Estate Photographer

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Comment balloon 0 commentsLew Corcoran, ASP® • July 08 2009 10:01AM


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