Should I float? Should I lock? - Daily Update for Tuesday, September 30, 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.

Wow - Who would of thought elected representatives would follow their constituents lead and deny one of largest bailouts of big business? The bailout in its current form was voted down by Congress yesterday resulting in the stock market's largest single day loss - over 700 points. One would normally expect bonds to increase accordingly, but the flight to safety went to US Treasury's - another example why Treasury's should not be followed when determining interest rates.

Technically speaking - the FNMA 5.5% 30 year bond rose to near 3 year highs yesterday but closed only slightly higher when the bailout was voted down. The bond is in neutral territory right now. This can lend a strength when bonds decide to improve for the better.

Until current 3 year lows are broken in a significant manner, I am recommending to

LOCK your mortgage rate.

To learn why one should Float or Lock -

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