Rate Lock Advisory

Thursday, October 22th

Thursday’s bond market erased overnight gains to open in negative territory. Stocks are calm during early trading with the Dow up 12 points and the Nasdaq up 2 points. The bond market is currently down 3/32 (0.82%), which should push this morning’s mortgage rates slightly higher.



30 yr - 0.82%







Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock



Treasury Auctions (5,7,10,20,30 year)

Neither of yesterday’s afternoon events had an impact on mortgage rates. The 20-year Treasury Note auction went fairly well with an average level of interest in the securities. That was followed by the release of the Fed Beige Book report that showed the economy is growing at a “slight to modest” pace according to the Fed’s business contacts. Because there were no surprises in either of those events, we saw little reaction to them in the bond market, leaving mortgage rates unchanged from their morning levels.



Weekly Unemployment Claims (every Thursday)

Kicking off this morning’s three economic releases was last week’s unemployment figures at 8:30 AM ET. They revealed that 787,000 new claims for unemployment benefits were filed last week. This was a decline from the previous week’s downwardly revised 842,000 initial filings and below forecasts of 860,000. The decline is a sign that the employment sector improved last week but still remains troubled. Because the numbers indicate stronger than expected conditions in the sector, we need to consider the data unfavorable for bonds and mortgage rates.



Existing Home Sales from National Assoc of Realtors

September's Existing Home Sales report was released at 10:00 AM ET. The National Association of Realtors announced a 9.3% increase in home resales, giving further evidence the housing sector remains strong during the pandemic. This was a larger than expected rise in sales, making the data bad news for bonds and mortgage rates.



Leading Economic Indicators (LEI) from the Conference Board

Also posted at 10:00 AM ET was September's Leading Economic Indicators (LEI) from the Conference Board. The indicators exceeded expectations slightly with a 0.7% rise, meaning they are predicting moderate economic growth over the next three to six months. This was not enough of a variance to have an impact on this morning’s mortgage rates.



Economic Stimulus News

Despite the batch of economic data, the bond market appears to be reacting more to stimulus news than anything else this morning. Headlines that show Speaker of the House Pelosi saying stimulus negotiations with the White House are making good progress and that a package could be passed by the House of Representatives before the election are putting a drag on bonds. Whether or not the Senate would approve such a package remains to be seen, but we are seeing an expected negative reaction to the comments this morning.




Tomorrow doesn’t have anything scheduled that we need to be concerned with. If there is a noticeable move in bonds or mortgage rates it likely will be a result of stimulus news or stock movement.

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.