Mortgage Rates Update

Friday's bond market has opened in negative territory despite the release of a fairly concerning Employment report. The stock markets are reacting favorably to the news with the Dow up 180 points and the Nasdaq up 30 points. The bond market is currently down 12/32, which will likely push this morning's mortgage rates higher by approximately .250 of a discount point. The Labor Department reported this morning that the U.S. unemployment rate rose to 7.6% last month. The 0.4% increase was more than expected and indicates that the employment sector is weakening at a faster pace than many had thought. While this is favorable news for bonds and mortgage rates, it gives little hope for the American worker. The report also showed a larger than expected loss of jobs during the month. The 598,000 loss was the worst since December 1974 and brings the last three month total to 1.8 million. That's the worst three month performance since the end of World War II and raises concerns about the rest of 2009. It is becoming more likely that we may set some new records this year that are not exactly worth bragging about. The average earnings portion of the report didn't reveal many surprises at an increase of 0.3%. However, despite this morning's bond favorable data, stocks are reaping the benefits during morning trading. The weaker than expected results in the employment report did not surprise me, but the reaction in bonds was disappointing.Next is pretty light in terms of economic releases, but it does bring us the release of one very important report. There are no relevant reports scheduled for release Monday. Look for more details on next week's events in Sunday's weekly preview.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... 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.
©Mortgage Commentary 2009