Mortgage Rates continued lower today as drama in Europe came roaring back.  In short, EU drama is and has been increasing the demand for safe-haven investments, such as US Treasuries.  Mortgage-Backed-Securities (MBS), which most closely govern mortgage rates TEND to move in the same direction as US Treasuries.  In cases like this where we have "panic" and/or "flight-to-safety," MBS can be thought of as indirect beneficiaries, essentially catching some of the glow from the spotlight on Treasuries.

Forget the wall at 4.25% for today.  For the first time in almost a month, we're closer to the left side of the following chart in terms of average Best-Execution rates.   

Today's Rates: 

  • BESTEXECUTION 30YR FIXED -   solidly 4.0 for many scenarios, some 3.875%
  • FHA/VA - 3.75%
  • 15 YEAR FIXED -  3.375%, still some 3.5's
  • 5 YEAR ARMS -  low 3% range, huge variations from lender to lender.

Today's Guidance:  Rates this low make lock/float decisions much less difficult.   The lower rates go right now, the more aggressively we'd lean toward locking.  Lock at 4.125-4.0 yesterday?  Great call.  Lock at 4.0 - 3.875 today?  Great call.  If Best-Execution hits 3.875% firmly with glimpses of 3.75% as it has only a few other times in the past, we literally can think of no reason to float at that point for anyone that needs or wants to refinance.   The lower rates go, the more we'll see resistance to further improvements and the more the risk outweighs the potential reward.