The Mortgage Interest Rate Lock Advisory for Sandwich MA for November 17, 2009
Here are some of the events affecting mortgage interest rates today in Sandwich, MA.
What the Mortgage Backed Securities Market is Doing Today:
The price of the FNMA 30-Year 4.5% MBS coupon opened at 101.75 this morning - down 4/32 from yesterday's close.
The chart below shows today's price trend of the FNMA 30-Year 4.5% coupon:
The FNMA 30-Year 4.5% MBS coupon is currently trading at 101.94 - up 6/32 from its opening. Remember, on mortgage backed securities (MBSs), as the price goes up, the yield comes down - and mortgage interest rates come down with it. I expect that mortgage interest rates will be 0.0% - 0.125% better in price this morning as compared to yesterday.
Recent Activity in Mortgage Backed Securities:
The chart below shows the price trend of the FNMA 30-Year 4.5% coupon over the past 30 days:
Economic Reports, News, and Events Affecting Mortgage Interest Rates Today:
- Producer Price Index (PPI) for October - the overall PPI reading is up 0.3% mostly due to higher energy costs, and follows a 0.6% decline the previous month. However, the core PPI reading declined 0.6% mostly due to declines in the prices of cars and light trucks, and follows a 0.1% decline the previous month. Analysts expected to see a 0.5% increase in the overall reading, and a 0.1% increase in the core data reading.
The PPI measures inflationary pressures at the producer level of the economy. There are two portions of the index that are monitored - the overall reading and the core data reading. The core data is the more important of the two because it excludes more volatile food and energy prices. Even though the report revealed weaker than expected readings, it had almost no impact on the mortgage market or mortgage interest rates this morning.
- Industrial Production Report for October - industrial production is up 0.1%, less than the 0.4% increase that was expected, and is less than the 0.7% increase the previous month. The capacity utilization rate (factory usage) remained at 70.7%, inline with expectations. This report provides us with a measurement of manufacturing sector strength by tracking output at U.S. factories, mines and utilities. However, this report usually does not have much of an impact on the mortgage market.
What's Happening With Mortgage Interest Rates Today:
Moderate to High Volatility. Overall, the first three days of the week will be the most important with the release of the Retail Sales Report, the Producer Price Index and the Consumer Price Index reports.
There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.
If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.
My Mortgage Interest Rate Lock Advice for Today:
If I were considering financing/refinancing a home, I would...
- Lock if my closing was taking place within the next 7 days
- Float if my closing was taking place between 8 and 30 days
- Float if my closing was taking place between 31 and 45 days
- Float if my closing was taking place between 46 and 60 days
This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of any or all other borrowers.
Get today's mortgage interest rates for your situation in Sandwich, MA.
