California Mortgage Rate Update for the Week of 11/05/12

 

 

If there was a way to put this blog post on hold and have the readers listen to Muzak until tomorrow's election, I would do it.  Last week, the markets reeled in the wake of Hurricane Sandy and by the time the NY Marathon was canceled, the mortgage rate market actually looked a tad better than the stalled early part of the week.  But more or less, it was a quiet week and rates were little changed from recent levels.  Recent levels being defined as just slightly higher than the record lows we saw in middle- to late-September and post-Fed action.  I suspect that the stock and bond markets will be well-behaved until the outcome of the election, but there is some data to mind and some events that could influence trading, and thus, mortgage pricing.

 

Economic highlights for the week: Monday's ISM data is already in, and it's slightly below expectations.  Not a real market mover, and definitely not in light of tomorrow's results.  There will be Treasury auctions this week (Tues, Weds, Thurs) and other than volatility midday, and if you're floating your rate through this week, these too will likely have mixed results.  At least that has been the recent trend.  Weekly jobless claims come in on Thursday, but that too is post-election and we've already just had the non-farm report.  So here also, I don't expect much.  Finally, Greece is back in the news.  I really don't need to say more, do I?  When you take a massive problem without an easy solution and you skip from one band aid fix to the next, eventually you have to address the cause of the bleeding, right?  Will it be this time?  Nobody is certain, but EVENTUALLY this needs to be dealt with and when it does it will likely have a positive effect on our mortgage rates --- again, assuming recent trends hold.  But let's not forget, it's all thin ice that Europe is skating on.

 

 

Lock advice: I have switched to a LOCK bias with my pipeline here before the election.  I just cannot, in good faith, have good clients floating into the volatility that may result.  Not when we're sitting at near all-time lows in rates.  But hey, if someone wants to float, I will ask him/her to tell me the reasons.  If they are good ones, we float.  But most often, I don't get well-constructed financial strategies, I just get, "well I think it may go lower."  This approach is fine if you don't make a living from assisting people with their finances.  It is not fine if your service is valued because you're right way more often than you're wrong.

 

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