Mortgage Rate Update March 2, 2012

Mortgage note rates are unchanged this morning but the accompanying closing costs are slightly less so in fact loan terms improved overnight.

As I stated in yesterday’s ‘rate update’, US interest rates, including mortgage rates, have traded in a tight range over the past few months.  Therefore, when rates cycle towards the high-end and low-end of the range it’s a pretty safe bet that they’ll reverse course in the near-term.  Rates touched the high end of the range on Wednesday after which I shifted to a floating position and now it looks like rates will improve.

In the near-term technical trading patterns are useful but over the long run economic trends will eventually take force.  Although some of the US economic data was mixed this week it seems like the economy is slowly improving which is a negative sign for mortgage rates.  Furthermore, at least for now much of the “doom and gloom” outlook for Europe has been replaced with cautious optimism.

Current Outlook: floating