Rate Lock Advisory

Monday, December 6th

Monday’s bond market has opened in negative territory, due partly to weekend Omicron news. Stocks are mixed with the Dow up 470 points and the Nasdaq down 33 points. The bond market is currently down 8/32 (1.38%), but gains late Friday should allow this morning’s mortgage rates to be lower than Friday’s early pricing by approximately .125 - .250 of a discount point. If you saw an intraday improvement Friday afternoon, you may see a small increase this morning.

8/32


Bonds


30 yr - 1.38%

470


Dow


35,050

33


NASDAQ


15,052

Mortgage Rate Trend

Trailing 90 Days - National Average

  • 30 Year Fixed
  • 15 Year Fixed
  • 5/1 ARM

Indexes Affecting Rate Lock

High


Negative


COVID-19 Matters

There is nothing of importance being released today. We are seeing bonds react negatively to weekend headlines that Dr. Fauci is encouraged by the preliminary research on the new Omicron variant. The fact his words are optimistic and not overly concerning has bond traders thinking the new variant may not have as heavy of a negative impact on the economy as thought last week. Expect this topic to be in the forefront for the next few weeks.

Low


Unknown


Productivity and Costs (Quarterly)

The rest of the week brings us the release of only three pieces of monthly economic data that may influence mortgage rates in addition to a couple of Treasury auctions. The start tomorrow morning with revised 3rd Quarter Productivity numbers at 8:30 AM ET. Higher levels of productivity are thought to allow the economy to expand without inflationary pressures rising. This is good news for the bond market because economic growth itself isn't necessarily bad for bonds. It is the conditions surrounding an expanding economy, such as rising inflation, that hurt bond prices and mortgage rates. Current forecasts are calling for a decline of 4.9% in productivity, nearly matching the initial estimate. The stronger the reading, the better the news for the bond market. This report generally does not have a noticeable impact on mortgage pricing though, so it will take a wide variance to draw much attention.

High


Unknown


Consumer Price Index (CPI)

Overall, Friday is the most important day for rates due to the importance the Consumer Price Index (CPI) carries. However, as we have seen several times over the past two weeks, the markets can get very active without notice. Therefore, please proceed cautiously if still floating an interest rate and closing in the near future.

Float / Lock Recommendation

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... 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 all/any other borrowers.


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Ameritrust Mortgage Associates,LLC (NMLS#167664)

Integrity - Experience - Service

150 East Palmetto Park Road, Suite 800
Boca Raton, Florida 33432