Mortgage Rates Remain Flat

Mortgage rates remained flat today as there seemed to be no push from any direction to give it some legs to move.  The most prevalent quoted conforming 30yr rate for top-tier scenarios remains at 4.5% after flirting with 4.625% last week.

We have seen the mortgage rate movement acting primarily as a factor of the daily trading activity in bond markets. While US Treasuries do more to set the general tone for domestic bond markets, it is the Mortgage Backed Securities (MBS) that most directly affect mortgage rates and what lenders can provide to the customers.  With that in mind, bond markets are clearly looking for guidance before making their next pronounced move, and clearly the old roller coaster that I used to mention in the later part of 2013 is still stuck at the gate – even though it has moved a couple of times just to tease us.

The last time we saw any significant movement was last week after the FOMC Forecasts showed a consensus for a slightly earlier Fed rate hike and a slightly higher rate by the end of 2015.  Rates didn't move any higher after that, but neither have they moved significantly lower.  Stronger prospects for inspiration are on the horizon next week, but the current week remains anyone's guess.  In general the risk and reward for floating and locking are anyone guess, but if you want to float, I would do it with caution.

In summary, today the stock indexes rallied but there was no selling in the bond and mortgage markets. There are still many safe haven trades in treasuries that also support the MBS market. Although the equity market had a good day, it remains vulnerable technically, and geo-politics is supporting rates at the moment.