Mortgage Rate Lock Advisory for Wednesday October 6, 2010

By
Mortgage and Lending with Bob Amato of Empire Home Mortgage Inc

If you are considering locking in a rate for a New York or Florida Mortgage consider reading this post.

Wednesday's bond market has opened in positive territory with the stock markets mixed and no important economic data scheduled for release today. The stock markets have failed to extend yesterday's rally, leaving the Dow up 12 points and the Nasdaq down 11 points. The bond market is currently up 9/32, which should improve this morning's mortgage rates by approximately .125 - .250 of a discount point.

With no relevant data being posted today, look for the stock markets to influence bond trading and mortgage rates the rest of the day. I suspect we will see a relatively calm afternoon in the bond market and little chance of a change to mortgage pricing.

Tomorrow's only data is last week's unemployment numbers. The Labor Department will post them early tomorrow morning. Since this weekly report tracks only a single week's worth of new claims, its impact on the markets and mortgage rates is usually minimal. There is a possibility of seeing mortgage r ates react to the news since it is the day's only release and the major monthly report will be posted Friday. Analysts are expecting tomorrow's release to show that 455,000 new claims for unemployment benefits were filed last week. The larger the number, the better the news for the bond market and mortgage rates.

The Labor Department will also post September's Employment report early Friday morning. This report will reveal the U.S. unemployment rate, number of new payrolls added or lost during the month and average hourly earnings. These are considered to be very important readings of the employment sector and can have a huge impact on the financial markets. The ideal scenario for the bond market is rising unemployment, falling payrolls and a drop in earnings.

If this report gives us weaker than expected readings, bond prices should move higher and we should see noticeably lower mortgage rates Friday. However, stronger than forecasted readings could be disastrous for mortgage pricing. Analysts are expecting to see the unemployment rate rise by 0.1% to 9.7%, little change in payrolls from August's level and a 0.1% increase in earnings.

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.

Empire Home Mortgage Inc. has over 15 years experience in analyzing credit and can suggest ways to improve your credit score to attain the best interest rate. Visit our website www.empirehomemortgageinc.com to get answers to your financing questions. We answer our phones 7 days a week if you have questions or need to get pre approved for a New York or Florida Mortgage. 

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