California Mortgage Rate Update for the Week of 05/29/12:
The Holiday-shortened week starts off with rates slightly better than the end of last week, where we saw some volatility creep back into the mortgage markets. And if you look at the run we've had over the last two months, and relative lack of excitement that has gone along with it, I guess it's no wonder that things would change a bit. Most of the lock/float advice lately has been centered around keeping a ready finger on the trigger and I would agree that this is sound policy for now. With Europe unfolding before us and potential for things to happen quickly, the complacency that has built up can unwind suddenly. Of course, this is important if you're one of the recent homebuyers who has been swept up in the frenzy to close on a desirable, well-priced property. You probably don't have the time or margin to wait out a drastic, swift change in the market, so let prudence be your guide and lock if you feel you've got something good --- chances are you probably do.
Economic highlights for the week: We got the Consumer Confidence report this AM and it was a dud. The markets have mostly shrugged it off. But let's not forget that something a little harder to dismiss, a jobs report, will be released on Friday. I think it's important to view the results both ways. A good jobs report could send money back into equities and away from bonds. Rates would worsen with that outcome. A bad jobs number, unless it's terrible, may not do much to improve rates. I sense a burgeoning numbness to jobs reports in the market. Everyone seems to have his guard up anyway. I think a poor jobs report will just keep the focus on Europe.
Lock advice: All things above considered, I am going with a LOCK bias in the near term. I cannot see a compelling reason to float. But if you have time and your transaction will permit, floating should work out fine for things beyond 45 or 60 days. You may even pick up .125% to your rate if the Euro cards fall the right way and your loan officer locks on an opportune day.
Remember, we now offer the HARP2.0 refinancing options for those who are underwater on their homes. Contact me with any scenarios.
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