We ended last week with mortgage interest rates yet lower once again. This drop in rates followed President Trump’s announcement and tweet that he is adding tariffs to imported aluminum and steel. This unsettled the financial markets which was good for mortgage bonds and thus resulted in a slight decline in mortgage interest rates.
The President’s announcement also overshadowed the (usually) important release of the University of Michigan’s report, Consumer Sentiment for February. Expected to come up .1 percent to 100, the index disappointed the market and came in at 99.7. Another factor in favor of mortgage interest rates because increased optimism about the economy usually leads to more spending and greater inflation concerns.
Starting out this week brings more economic news that can impact rates with Thursday being the most significant day for news.
Here’s a rundown of economic reporting for the week:
- Monday: New Home Sales for January (minor influence)
- Tuesday: Durable Good Orders for January (average influence), Case-Shiller Home Prices for December (average influence), and Consumer Confidence for February (MAJOR influence).
- Wednesday: Pending Home Sales for January (average influence)
- Thursday: Weekly Unemployment Claims (average influence), Personal Income (major influence), Consumer Spending (major influence), Core Inflation Rate (average influence), ISM Manufacturing Index (average influence)
- Friday: Consumer Sentiment for February (major influence)
Mortgage Rate Lock Recommendation
Today is a great day to lock in and take advantage of what is likely to be a short-lived rally.
A best practice, pricing for a 30-day lock is pretty much the standard most lenders will (should) quote you. The 15-day option should get you a slight discount, and locks over 30 days will have a higher cost to secure.
In an environment where rates are rising, the decision to lock or float becomes tricky. Obviously, if you know interest rates are going up, you want to lock in as soon as possible. However, the longer you lock, the higher your upfront costs. If you are weeks away from closing on your mortgage, that’s something to consider. On the other hand, if a higher rate would affect your mortgage approval, you’ll likely want to lock the interest rate even if it costs you more.
If you’re still floating, stay in close contact with me or your lender, and always keep an eye on markets.
LOCK if you are closing within the next 30 days.
FLOAT if you are closing 45 days or longer.
Let’s get started on your mortgage plan.
Let me help you get your purchase or refinance strategy in place call me at 214-770-1499 or complete the form below.