Rate Lock Advisory

Tuesday, April 25th

Tuesday’s bond market has opened in negative territory again following another strong open in stocks that are reacting to strong earnings news. This has pushed the Dow up 227 points while the Nasdaq has gained 34 points. The bond market is currently down 8/32 (2.29), which should push this morning’s mortgage rates higher by approximately .125 of a discount point is comparing to Monday’s early pricing.



30 yr - 2.29%







Mortgage Rate Trend

Trailing 90 Days - National Average

  • 30 Year Fixed
  • 15 Year Fixed
  • 5/1 ARM

Indexes Affecting Rate Lock



New Home Sales

March's New Home Sales report was the first of this morning’s two releases. The Commerce Department announced at 10:00 AM ET that sales of newly constructed homes rose 5.8% last month. This was stronger than expected, indicating the new home portion of the housing sector was stronger than many had thought. Because that is a sign of economic strength, we should consider the data negative for bonds and mortgage rates.



Consumer Confidence Index (Conference Board)

The second release of the day was April's Consumer Confidence Index (CCI), also at 10:00 AM ET. This Conference Board release showed a reading of 120.3 that fell short of the 122.3 that was forecasted. It was also a decline from March’s revised 124.9, meaning surveyed consumers were less optimistic about their own financial and employment situations than they were last month. Since waning confidence usually translates into softer levels of consumer spending, this data is good news for mortgage rates.



Treasury Auctions (5,7,10,30 year securities)

Tomorrow has no relevant economic data set for release, so we can expect stock movement to again heavily influence bond trading and mortgage pricing. What we do have tomorrow is the first of two relatively important Treasury auctions that may affect mortgage rates. There will be an auction of 5-year Treasury Notes tomorrow and 7-year Notes on Thursday. Neither of these sales will directly impact mortgage pricing, but they can influence general bond market sentiment. If the sales go poorly, we could see broader selling in the bond market that leads to upward revisions in mortgage rates. On the other hand, strong sales usually make government securities more attractive to investors and bring more funds into bonds. The buying of bonds that follows usually translates into lower mortgage rates. Results of the sales will be posted at 1:00 PM ET each auction day, so look for any reaction to come during afternoon hours.

Float / Lock Recommendation

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... Lock 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 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 all/any other borrowers.