Monday's bond market has opened flat with no relevant economic news scheduled for release today. The stock markets are showing losses with the Dow down 60 points and the Nasdaq down 12 points. The bond market is currently unchanged from Friday's close, but we still may see a slight increase from Friday's morning rates.
This week is very light in terms o f economic releases for the markets to digest, especially compared to last week. There are two monthly and one quarterly reports on tap, but only the quarterly one can be considered to be highly important. This makes it quite likely that we will see a fairly quiet week in the mortgage markets, assuming that the stock markets do not repeat last week's volatility.
The first piece of data scheduled for release comes Wednesday morning with the release of the 3rd Quarter Productivity report. The productivity index is expected to show a level of worker productivity during the third quarter similar to last quarter's final reading of 3.1%. This would be good news for the bond market because high levels of productivity helps the economy to expand without inflationary pressures being a concern.
The final two releases of the week will be posted Friday morning. The first is September's Goods and Services Trade Balance report. The second will be November's preliminary Univ ersity of Michigan Index of Consumer Sentiment during late morning trading. Neither are considered to be major market movers, but with little data being posted this week we may see some movement in rates as a result.
Overall, look for a fairly quiet week in the mortgage market unless something totally unexpected transpires. As long as the stock markets remain fairly calm, I am expecting to see little movement in mortgage rates. However, I am extending the lock recommendation to short and mid term periods. This is not an indication that I necessarily feel mortgage rates will rise. It means that the risk versus reward scale is leaning towards the risk side. If mortgage rates are not likely to improve during that time frame, then there is little reward of continuing to float. Accordingly, a lock recommendation is appropriate in my opinion.
If I were considering financing/refinancing a home, I would.... Float 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.
Please let me know if I can provide loan information for any of your clients. I would be happy to quickly pre-qualify them, provide loan scenarios, or help improve their credit position to obtain a lower interest rate.
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