Rate Lock Advisory

Monday, November 18th

Monday’s bond market has opened in positive territory despite a lack of relevant economic data. Stocks are starting the new week mixed with the Dow up 17 points and the Nasdaq down 18 points. The bond market is currently up 8/32 (1.80%), which should improve this morning’s mortgage rates by approximately .125 of a discount point from Friday’s early pricing.



30 yr - 1.80%







Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock



Geopolitical/Financial Issues

Today doesn’t have anything scheduled that is expected to influence mortgage rates. The bond market is reacting to rumors that the trade deal with China is on shakier ground than previously thought. The rumors indicate that China and the U.S. are not in agreement on a couple of the key points, particularly the rollback of tariffs. Since tariffs and trade wars tend to negatively impact the global economy, this unexpected news is favorable for bonds and mortgage rates.




The rest of the week brings us the release of four monthly economic reports in addition to the minutes from the most recent FOMC meeting. All of the scheduled releases are considered to be moderately important. This should help minimize the day-to-day movement in rates.



Housing Starts (New Residential Construction)

October's Housing Starts will start the week’s calendar at 8:30 AM ET tomorrow. This report gives us an indication of housing sector strength but usually does not have a noticeable impact on mortgage rates. I don't expect this month's version to be any different unless it varies greatly from analysts' forecasts. It is expected to show an increase in starts of new homes, meaning the new home portion of the housing sector strengthened a little last month.




Overall, Thursday is the best candidate as most important day for rates while the calmest could be tomorrow. We saw a nice move lower in bond yields last week that led to improvements in mortgage pricing even though stocks rallied. The benchmark 10-year Treasury Note yield closed the week at 1.83% and is currently at 1.80%. If the trend continues and the 10-year breaks below 1.78%, we could see another leg lower in yields and mortgage rates. Until that level is broken though, it is prudent to watch the markets if still floating an interest rate and closing in the near future because failing to break below could mean an upward bounce in yields and rates are likely.

Float / Lock Recommendation

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 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... 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.