Rate Lock Advisory

Wednesday, April 25th

Wednesday’s bond market has opened in negative territory, pushing the benchmark 10-year Treasury Note yield above 3.00% for the first time almost 4 ½ years. Stocks are showing losses, pushing the Dow lower by 56 points and the Nasdaq down 15 points. The bond market is currently down 6/32 (3.02%), which should lead to an increase in this morning’s mortgage rates of approximately .125 of a discount point.



30 yr - 3.02%







Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock



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

There is no relevant economic data set for release today, but we do have a potentially influential Treasury auction to watch this afternoon. 5-year Treasury Notes are being sold today while 7-year Notes go tomorrow. Neither of these sales will directly impact mortgage pricing, but they can influence general bond market sentiment. If the sales go poorly, we could see broader selling in the bond market that leads to upward revisions in mortgage rates. On the other hand, strong sales usually make government securities more attractive to investors and bring more funds into bonds. The buying of bonds that follows often translates into lower mortgage rates. Results of the sales will be posted at 1:00 PM ET each day, so look for any reaction to come during early afternoon hours.



Durable Goods Orders

Tomorrow has two pieces of economic data being posted, one of which is much more important than the other. First up is March's Durable Goods Orders at 8:30 AM ET tomorrow. This report gives us an indication of manufacturing sector strength by tracking orders for big-ticket items at U.S. factories. These are products that are expected to last three or more years, such as appliances, electronics and airplanes. Current forecasts are calling for an increase in new orders of 1.9%. This would be a sign of manufacturing sector strength, but this data can be quite volatile from month-to-month. Therefore, a small variance between forecasts and the actual results will not heavily affect the markets or mortgage rates. A large decline would be considered good news for mortgage pricing, while a large rise would indicate strength in the sector. A sign of solid manufacturing growth could lead to higher mortgage rates tomorrow morning.



Weekly Unemployment Claims (every Thursday)

The other release will be last week’s unemployment figures, also at 8:30 AM ET. They are expected to show that 225,000 new claims for unemployment benefits were filed last week, down from the previous week’s 232,000 initial claims. Since rising claims hints at employment sector weakness, the higher the number the better the news it is for mortgage rates. However, because this is only a weekly report, it likely will have little impact on tomorrow’s mortgage rates unless it shows a significant variance and the Durable Goods Orders is uneventful.

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... Lock 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.