A lot could have gone wrong last week. Several variables indicated that mortgage rates would be worsening by the end of the week. Also, we had the Federal Reserve's announcement on Tuesday afternoon regarding the decision to keep the benchmark lending rates unchanged. Although the financial community had more or less already planned on the rate staying unchanged, the actual statement that accompanies the decision is the item of importance , especially when rates are not deviating from expectations

In A Word: Last time (no pun intended), we asked if the bit of positivity we experienced on Tuesday would last. It certainly did as Wednesday was a great day that saw Mortgage Backed Securities (MBS, the bonds that directly relate to mortgage rates) rise throughout the day. The risk was that it would reverse this morning and it has not. Although volatile, and although we are not gaining any longer, we have not lost enough to ground to worsen mortgage rates by more than the smallest margin. The Why

In A Word: Despite weaker than expected economic data and the Dow average moving down, Mortgage bonds cannot seem to garner enough support to get rates to improve at all this morning. The Why: What does that headline mean? Recall that mortgage rates are a direct result of the trading price of the bonds that are secured by mortgage portfolios - Mortgage Backed Securities (referred to as MBS). MBS are part of a group of investments that pay a fixed rate of return based on a purchase price versus a

In A Word: As we discussed, there was a potential for mortgage rates to rebound slightly from yesterday's "hammering" regardless of data this morning and simply because it's the psychological nature of cyclical securities to take 2 steps forward and one step back regardless of which way they are moving. Today would be the one step back (that's a step back from the mad dash over a cliff!). So we have some relief today. The Why: Again, the Inflation Boogie Man is the culprit (the main one at least

In A Word: Due to stronger than expected news concerning pending home sales, mortgage rates have risen since last week. The Why: Remember that mortgage rates are dictated directly by the trading of Mortgage Backed Securities, which are essentially bonds. So when there is a greater demand for these bonds, the price goes up. And with bonds, the higher the price, the lower the yield for the investor buying it. It is this yield that translates directly into your interest rate. So, in general, when economic

In A Word: Although rates were at risk of getting worse this morning, the forces that move rates behind the scenes have turned positive which should lead rates, by the end of the day at least, to be the same as yesterday's. Keep in mind that as the bonds that back mortgages (Mortgage Backed Securities) trade throughout the day, it can cause lenders to change their interest rates, so things may change, but for now we are good. To Lock or Float? This is still a tough call as we have the most potential