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If you've been floating for the past few weeks, your rate has greatly improved. Even after rates mortgage rose today, they're still close to record low levels. Quite often people want to wait to see a clear bottom in mortgage rates, unfortunately we never know if rates are at their lowest levels until they start rising. So by the time you realize mortgage rates aren't going any lower, they've already gone up! I think I can sum up the lock/float decision with one question. If you were offered the mortgage rates we are seeing today, two months ago...would you have locked then? I think everyone would answer yes to that question. ...

Mortgage rates bounced around a tight range for most of the week. There wasn't much in the way of news to motivate movement in the first three days of the week. Although we did get several key earnings releases, the economics calendar was essential empty and the market's general tone reflected a lack of conviction. Rates were unchanged on Monday, rose modeslty on Tuesday then recovered from weakness on Wednesday only to give it back positive progress on Thursday after the Treasury announced the terms of next week's debt auctions. This left rates a few bps higher (vs. Monday) heading into today. ...

It was a very slow day on Wall Street as most market participants are still trying to figure out if the Goldman Sachs news is going to spread around to other primary dealers and banks. Unfortunately this was not helpful for the bond market as yields slowly rose throughout the day. This resulted in a few lenders repricing for the worse, but not all. Reports from fellow mortgage professionals still indicate lender rate sheets to be improved from Friday. The par 30 year conventional rate mortgage is in the 4.875% to 5.125% range for well qualified consumers. With mortgage rates near the best levels of the year, I favor locking any loan closing within the next 30 days. At this point, you have much more to risk than to gain by floating. All year, market participants and lenders have been reluctant to move rates lower than current levels. ...

Mortgage rates are slowly rallying away from the highs of 2010 after a two successful Treasury auctions. I continue to favor floating my loans, but will be re-evaluating this sentiment on a daily basis1 ...

I favor locking over floating at this point. There are just too many unknowns to deal with in the near term. The Fed stops buying MBS tomorrow, more Treasury debt supply is announced on Thursday, and then we get the all important Employment Situation Report on Friday. When the Fed stops buying MBS, the largest supporter of low mortgage rates will be removed from the market. While we do anticipate investor demand to remain strong, it may take some time for the secondary mortgage market to get comfortable without the Federal Reserve. This should present itself via added price volatility and the potential for larger movements in mortgage rates. While I still favor locking over floating for loans closing in 30 days, I understand why some folks might be consider waiting it out a few more weeks. Benchmark yields have risen significantly over the past week. Considering the big picture economic outlook has not changed (slow growth at best) since benchmark yields moved higher, it is very tempting to float through Non-Farm Payrolls on Friday. I caution though, this is a risky move, especially because the reward you will receive is not so great. There isn't much more room for rates to move lower, 0.25% at most. The safe move is to lock. ...

Benchmark interest rates started rising early in the trading session, before MBS trading officially opened at 8am. Positive Durable Goods Orders data added weakness. Then poor demand at the five year Treasury note auction intensified bond market selling. After that, buyers basically gave up which pushed yields higher and higher. Over the course of the day, the 10 year Treasury note yield rose 16 basis points, MBS prices plummeted on more than one occasion and lenders were forced to reprice for the worse, more than one time! Reports from fellow mortgage professionals indicate lender rate sheets to be much worse today. ...

Yesterday I informed you that the most significant threat to mortgage rates was today's 10 year Treasury note auction and the 30 year bond auction scheduled to happen tomorrow. Well, benchmark yields started rising before the auction even occurred! This forced MBS prices lower and resulted in lenders raising mortgage rates early in the day. Higher rates did not reverse course after the auction either, regardless of strong demand. ...