Should I float? Should I lock? - Daily Update for Wednesday, October 1, 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 markets are a fickle place. Yesterday investors realized a fire sale was taking place and responded appropriately - sending the stock market up 400+ points. This morning investors are skittish because of the Senate voting on the bailout bill this evening. The Manufacturing Index came in quite a bit lower than expected indicating further sluggishness in the economy. This is helping to propel bonds upward.

Technically speaking - the FNMA 5.5% 30 year bond fell to the 200 day moving average yesterday with the rebound of stocks and the increase of consumer confidence. So far today, the bond has reclaimed almost half of what it lost yesterday. Bonds are continuing to approach oversold level which always helps when the next positive turn around occurs..

Until current 3 year highs 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