Rate Lock Advisory

Wednesday, October 20th

Wednesday’s bond market has opened flat with little to drive trading this morning. Stocks are mixed with the Dow up 89 points and the Nasdaq down 8 points. The bond market is currently unchanged from yesterday’s close (1.64%), which should keep this morning’s rates at Tuesday’s early levels.



30 yr - 1.64%







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)

Both of today’s events that may affect mortgage rates are taking place this afternoon. The results of today’s 20-year Treasury Note auction will be posted at 1:00 PM ET. If the sale was met with a strong demand from investors, particularly international buyers, we could see a slight improvement to rates later today. On the other hand, a lackluster interest in the securities may create selling in the broader bond market and lead to an upward revision in rates.



Fed Beige Book

Next up will be the release of the Federal Reserve's Beige Book report that summarizes economic activity through the eyes of business contacts within each Fed region. The Fed relies heavily on this data during their FOMC meetings when making monetary policy decisions, so look for a potential reaction during mid-afternoon afternoon trading. It probably will not cause a major sell off in the stock or bond markets, but the 2:00 PM ET release is still worth watching as it could draw enough of a reaction to change rates slightly.



Weekly Unemployment Claims (every Thursday)

Tomorrow has three pieces of economic data for the markets to digest. They begin with last week’s unemployment update at 8:30 AM ET. Analysts are expecting to see 300,000 new claims for benefits were filed, up from the previous week’s 293,000 initial filings. Rising claims are a sign of a weakening employment sector. That means the higher the number of new claims, the better the news it is for mortgage rates. Although, because this is only a weekly snapshot, we shouldn’t expect it to have a noticeable impact on rates unless it shows a significant variance from forecasts.



Existing Home Sales from National Assoc of Realtors

September's Existing Home Sales data will be posted at 10:00 AM ET tomorrow. The National Association of Realtors will give us another indication of housing sector strength and mortgage credit demand by tracking home resales. It is expected to show an increase in sales, meaning the housing sector strengthened last month. That would be relatively bad news for the bond market since a stronger housing sector makes broader economic growth more likely and causes bonds to be less appealing to investors. Good news for rates would be a sizable decline in sales that points toward a weakening housing sector.



Leading Economic Indicators (LEI) from the Conference Board

The week's calendar closes with September's Leading Economic Indicators (LEI) from the Conference Board, also late tomorrow morning. This index attempts to predict future economic activity, particularly during the next three to six months. Current forecasts are calling for an increase of 0.5% from August's reading. The increase would mean the indicators are pointing towards stronger economic activity over the next several months. An increase of that size would not be of much concern to the bond and mortgage markets. A smaller rise, or a decline would be favorable to mortgage pricing.

Float / Lock Recommendation

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.

Omni Mortgage Corp.

118-18 101st Avenue
Richmond Hill, NY 11419