Rates are looking ok to end the week with mortgage bonds (MBS) regaining some ground they started losing last week (rates drop when MBS prices rise and vice versa). However, MBS sold off a bit this afternoon, pushing rates up slightly since this morning. Below is an excerpt from my commentary on MortgageNewsDaily:
Rates were better this morning and have just recently (as of 11:25 am PT) gotten worse as mortgage bond (MBS) selloff has gained steam in the last half hour. With this morning’s rate improvements on top of yesterday, we were able to lock some clients who had established target rates and were therefore ready to go. Now, unless we get a sharp reversal into positive territory, we’ll hold on locking anyone else until Monday. This is a good reminder to clients that rates move in real time throughout each MBS trading day. When it’s volatile like this, clients need to have target rates that they can’t or won’t go above, and give lenders standing orders to lock those rates when they become available.
The target for rate shoppers should be to capture record lows that we keep touching, rising above, then touching again. My comments are made in this context.
Some refi rate shoppers are holding for rates to go even lower than record lows already set. Here’s the full MortgageNewsDaily piece* in which MBS analyst Matt Graham describes how the current state of the MBS market makes that even-lower-low target elusive.
*It’s also worth noting that the rates on that page are for single family home loans to $417k. Rates are higher for larger loan amounts and different property types.