Rate Lock Advisory

Thursday, December 3rd

Thursday’s bond market has opened in positive territory even though this morning’s economic data was somewhat unfavorable for bonds. Stocks are reacting positively to the data, pushing the Dow up 113 points and the Nasdaq up 65 points. The bond market is currently 4/32 (0.92%), which should improve this morning’s mortgage rates slightly.



30 yr - 0.92%







Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock



Fed Beige Book

Yesterday’s afternoon release of the Fed Beige Book failed to show any significant surprises. It indicated the economy strengthened during the fall but moved to a slower pace last month as COVID cases started to rise again. Four of the Fed’s 12 districts reported little or no growth, showing signs of strain on the broader economic recovery. The report was generally favorable for bonds and mortgage rates. However, the lack of surprisingly strong or weak conditions prevented bonds and mortgage rates from reacting to the news.



Weekly Unemployment Claims (every Thursday)

Last week’s unemployment figures were posted early this morning, revealing 712,000 more people filed for unemployment benefits during the week. That was down from the previous week’s revised 787,000 and well below expectations. Since fewer claims is a sign the employment sector improved slightly last week, we can consider the data negative for bonds and mortgage pricing. Fortunately, this is only a weekly snapshot of the sector, minimizing the impact on today’s rates.



Employment Situation

Tomorrow has two economic reports scheduled for release, one of which is considered to be extremely important and highly influential to the financial and mortgage markets. That would be November’s Employment report at 8:30 AM ET, which is comprised of many employment statistics and readings of the employment sector. The most watched are the unemployment rate, the number of news jobs added or lost during the month and average hourly earnings. Current forecasts call for the unemployment rate to have been 6.8% (down from October’s 6.9%), while 550,000 new jobs were added back to the economy. The income reading is forecasted to show an increase of 0.1%. The ideal scenario for mortgage shoppers would be a higher unemployment rate, a much smaller increase in payrolls (or a decline) and no change in the earnings reading. However, stronger than expected readings may fuel bond selling that would lead to higher mortgage rates.



Factory Orders

October's Factory Orders report will close out this week’s calendar at 10:00 AM ET tomorrow morning. This Commerce Department report is similar to the Durable Goods Orders report that was released last week, except this one includes new orders for both durable and non-durable goods. It usually doesn't have a significant influence on bond trading since a good portion of the data has previously been made public. Analysts are expecting to see a 0.8% rise in new orders. Favorable news would be a weaker reading because it would signal softer than expected manufacturing sector activity. However, the Employment report will draw all the attention tomorrow, limiting the importance of this one even more than usual.

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... 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.