Mortgage Rates & Trends - 11/4/2013

Last Week's Mortgage Rate Recap

Mortgage Rates Currently Trending: HIGHER

Last week saw rates deteriorate an average of .125%, depending on the lender, as we saw MBS (Mortgage Backed Securities) pricing deteriorate and test the support level of 102.00 after the announcement from the Fed meeting and the much higher than anticipated Chicago PMI number.  The economic data and announcement concerned the markets that the Fed might not wait until next March to begin the tapering of the markets that we have been so concerned about the last month.  This news was bad for bonds and led to a Friday selloff that tested the support level at 102.00 which appears to have held up. 

 

 

This Week's Mortgage Rate Forecast

Mortgage Rates Forecast: NEUTRAL, but high threat of volatility

This week we will be dealing with the October employment data being released on Friday, which will be the focus for the week.  On Thursday the third quarter GDP numbers will be released, and depending on if we meet market expectations or fall below could lead to either an MBS rally or a sell off.  If we continue to trade within the current channel, that bodes well for rates.  However if we sell off and pierce the support level at 102.00, be ready to see rates jump.

 

BOTTOM LINE: There is risk to floating right now, but also potential reward. The best course of action is to stay in contact with your Mortgage Loan Professional to watch the market in real time to stay a step ahead of lender reprices and market trends to protect your mortgage rate.