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The first release of lender rate sheets was interesting. MBS prices opened basically unchanged vs. closing levels yesterday, but loan pricing was much worse. This makes sense because lenders were inundated with lock request yesterday afternoon and needed time to recover, so they made pricing worse in an effort to slow lock request activity. This was pretty frustrating to any loan officer who missed the boat on locking their loans yesterday, but MBS prices were rallying and the day wasn't over. In fact, we weren't even halfway through the morning when several lenders repriced for the better. This brought mortgage rates down a few more basis points. 4.375% is once again an attainable mortgage rate after reprices for the better. ...

For whatever reason, which fundamental and technical can be offered, stocks sold off today. The S&P was down 2.01% to 1135.80 and the Dow fell 1.50% to 10,621.14. This led to another "flight to safety" rally in Treasuries which led mortgage-backed security prices to new highs of the year. This allowed lenders to improve mortgage rates. We actually saw some lenders offering 4.75% at no points...

If you can lock in today at 4.875% with acceptable fees, you should strongly consider locking. If your lender is offering 5.00% or higher, I feel it is worth the risk to float. Our "lock at the price highs, float the lows" strategy has worked well this year. I continue to believe 4.75% is the lowest rate we shall see this year. With the upcoming end of the Fed’s MBS purchase program and the seemingly unending supply of treasuries coming to market, we may not see 4.75% again. However, I do feel there is a good chance benchmark Treasury yields will move lower in the next few days. This should help MBS prices rally and allow lenders to improve rate sheet pricing a few more basis points. If you can stomach the ride, let's cautiously float into next week. ...

Reports from fellow mortgage professionals indicate lender rate sheets to be marginally worse when compared to Friday afternoon pricing. However the best par 30 year fixed conventional mortgage rate does remain in the 4.75% to 5.00% range for well qualified consumers. Mortgage rates are more or less holding steady near the lowest levels of 2010 even as benchmark Treasury yields have risen. If you have been sitting on the sidelines waiting to refinance, now is the time. The Fed is about to end its MBS purchase program at the end of the month, while we do not expect mortgage rates to skyrocket, we do anticipate they will move steadily higher. ...

Following the release of much better than expected 4th Quarter GDP, mortgage-backed security prices fell. This forced lenders to move mortgage rates slightly higher early on in the day. That didn't last long though. Around lunch time MBS prices began to improve. After the lunch hour, momentum picked up and lenders started repricing for the better. The par 30 year conventional rate mortgage rate ends the week in the 4.75% to 5.125% range for well qualified consumers. While I am not totally against floating over the weekend, I still can't provide enough justification to ignore currently aggressive mortgage rates, especially after lenders repriced for the better this afternoon. ...

Mortgage rates moved higher today as MBS prices fell following two better than expected economic reports. The move lower in MBS prices forced lenders to reduce rate sheet rebate, pushing consumer borrowing costs higher for the third consecutive day. The streak of rising rates was started by a weak 3 year note auction on Tuesday which carried over into Wednesday and Thursday after the Treasury found it difficult to attract demand for their auctions of 10 year notes and 30 year bonds. Unfortunately the negative momentum extended into today thanks to retail sales and consumer sentiment releases were better than anticipated. ...

It was a busy day in the rates market yesterday. Although several data releases needed to be digested, the main event was the 30 year bond auction. Recently, while demand for shorter maturity Treasury notes has proven stable in the "post-November 4 FOMC statement" environment, the market has forced yields higher in the long end of the yield curve. Specifically the benchmark 10yr note and the 30 year bond have taken a beating over the past two weeks. Yesterday was the first chance we had to really test market's appetite for longer dated debt investments, which have more of an influence over mortgage rates. Unfortunately, while specific buyers supported the bidding, overall demand was weak compared to previous auctions. Following the release of the auction results, MBS prices plummeted and a few lenders with itchy trigger fingers repriced for the worse. However, soonthereafter the rates market recovered all losses and prices went green on the day! By the end of the day, MBS prices were at their highest levels in quite some time. Most lenders repriced for the better as the gains held until close. To remind readers, as the price of MBS move higher, lenders are able to pass along lower mortgage rates. That momentum has carried over into today as MBS prices are once again slightly higher. ...

I have been using a well defined trading range to gauge my lock/float recommendations. The idea is to lock at the price highs and float at the price lows. On Friday I recommended floating through the weekend, this strategy worked out well as mortgage rates are modestly improved (not big improvements) today. Considering that MBS are holding near the top side of the trading range and as AQ and MG put it, there isn't much room for MBS prices to continue to improve, I have advised a few of my higher loan amount clients to lock in their loans....