Mortgage Rates Holding in a Tight Range

No matter what the news - higher stocks, lower stocks, trade wars, political drama - nothing seems to have the power to break the 10-year Treasury range. Mortgage rates are moving sideways right now but that could certainly change over the next few days as we get a number of economic reports and hear from some Fed officials.

Where Are Mortgage Rates Going?                     

>>> Trade tension eases slightly ahead of busy week

Here we go with another busy week, and it will only be for four days as the markets will be closed on Good Friday. Before then, we have a handful of notable economic reports out for release this week such as, consumer confidence, Case-Shiller house price index, GDP, personal income and spending, core PCE and Chicago PMI. Financial market participants will be keeping an eye on these reports and could certainly make some changes to their portfolios depending on what the data says.

We will also be hearing from several Fed officials this week. It will be interesting to see what type of position many of them take and how they move forward after last week’s decision to raise the federal funds rate by a quarter-point.

Right now, mortgage rates are not doing a whole lot. The yield on the 10-year Treasury note (the best market indicator of where mortgage rates are going) is holding steady at 2.83%. On Friday, the 10-year fell at one point to 2.80%, closing at 2.81%. The bottom of the range that now has extended since the beginning of February.

According to industry publication Mortgage News Daily, bonds have been behaving as though "they are on vacation," remaining in a fairly tight range despite whatever has been happening around them. That stability can be helpful for those too far from closing to consider locking.

Rate/Float Recommendation                      

>>> Do not get caught in this quiet period, best to lock.

With a number of key reports that we will see this week, there is definitely the possibility for mortgage rates to bounce around a little. Long-term rates are expected to move steadily higher. It makes sense, then, for most borrowers to lock in a rate as soon as possible.

In a rising rate environment, the decision to lock or float becomes complicated. Obviously, if you know rates are rising, you want to lock in as soon as possible. However, the longer you lock, the higher your upfront costs. If you are weeks away from closing on your mortgage, that is something to consider. On the flip side, if a higher rate would wipe out your mortgage approval, you would probably want to lock in even if it costs more. If you have yet to talk to a lender, give me a call or visit my website at Call The Money Man.