Mortgage Rates Flat - At A Fork In The Road - All Ahead Of Fed's Announcement

Mortgage Rates again remained unchanged today, but the Mortgage Back Securities (MBS) rode the roller coaster lower today, matching or beating the best levels seen so far in 2014.  Weakness over the past two days threatened to carry rates higher off the floor that we have seen for the past two weeks, but the improvement today decisively preserves the floor – and now is teasing us with the possibility that we may go lower.   4.5% remains the most prevalently quoted conforming 30yr fixed rate for ideal scenarios. 

Yesterday, we discussed the possibility that rates were coming to a fork in the road  ahead of next week's FOMC (Fed’s) Announcement.  We had seen for the past several days some weakness, as lenders were threatening to keep the rates steady and adding fees to keep it at such.   Today we got the complete opposite!  Even though it was a welcome surprise from the first two days of this week, we are still at the fork in the road as the outlook is still dominated by next week's FOMC (Fed’s) Announcement.  I do not anticipate the change we saw today can be sustained between now and then.

In summary, what a difference a day makes!  Rates rallied back to the best levels of the year today.  Tomorrow will tell if we can retain these gains and push the floor even further.  Floating borrowers are still playing a high risk, as the gamble is still out there.  Floating is asking for a higher rate or creating a "worry about it" situation that is not warranted. If rates drop then renegotiate down, but thinking you missed an opportunity by locking is not realistic.

If there are any issues you would like to discuss with your financing, please give me a call at 314-744-7806, or visit my website at www.CallTheMoneyMan.com.