Should I float? Should I lock? - Daily Update for Wednesday, March 12, 2008

Here are the daily thoughts on floating or locking if you are asked by your clients. 

As always - consult your favorite mortgage professional who will be able to offer the best advice for YOUR unique situation.

The Federal Reserve injecting the load of cash to the banking system yesterday delighted both the stock and bond markets.  Stocks rose 400 points and bonds held steady (this is good news since bonds normally act in an inverse relationship to stocks).  Regularly scheduled reports will come out again tomorrow with Retail Sales being reported and then the consumer price index on Friday.

Technically speaking - the FNMA 5.5% 30 year bond held its own yesterday.  This morning the bond hit the 10 day moving average and bounced lower.  Now testing it again for the 2nd time today, it could potentially break through if stocks take another tumble.

Until some stability returns to the market I am recommending to   

     Lock your interest rate.

                          Check out Should I float? Should I lock? & Reasons to Float or Lock