Mortgage Rate Watch

Dear Clients and Business Partners:Thursday's bond market has opened in negative territory yet again despite significant stock weakness. The Dow is currently down 220 points while the Nasdaq has lost 45 points and it appears that those losses may widen as the day progresses. The bond market is currently down 19/32 as supply concerns continue to weigh on trading. This will likely push this morning's mortgage rates higher by approximately .250 of a discount point.There were two pieces of economic data released this morning and both gave us much weaker than expected results. Unfortunately, it appears bond traders are ignoring the data since they are not usually considered to be of high importance. This is despite wide variances between forecasts and actual readings.The first was December's Housing Starts that showed a decline in new home starts that was quadruple the drop that was expected. This gives further credence to the theory that the housing sector has not bottomed out ye t.The second piece of data was weekly unemployment figures from the Labor Department. They reported that 589,000 new claims for benefits were field last week, greatly exceeding the 543,000 claims that were forecasted. This points to a still softening labor market and does not give hope of a economic recovery anytime soon without stimulus assistance.There is no relevant economic data scheduled for release tomorrow, so I would not be surprised to see more weakness in bonds and pressure in mortgage rates. It is becoming clear that the market is quite concerned about the amount of debt that the government will need to sell to meet goals that the new administration is expecting.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... Float 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.