Mortgage rates are higher again this morning. Hopefully you’ve followed the advice of ‘rate update’ since Thursday of last week and you are protected from these losses.
The fact that mortgage rates are rising is not a huge surprise. Back in August I blogged about two important economic factors that were likely to lead to higher rates beginning in 2010 (you can see these posts here and here). Furthermore, yesterday the Wall Street Journal released the results of a survey they conducted which showed all 18 of the primary dealers that underwrite US Treasury notes and bonds forecast higher rates in 2010.
However, what is surprising is the fact that rates remained low for so long and are now all of a sudden rapidly moving higher. In the past 3 trading days rates have increased by .25%-.50%. Ouch!
Momentum is not on our side and since there are fewer traders in the market because of the holiday we may continue to see rates slide higher. However, all it takes is one small reminder that the economy is not on firm ground. I feel like we could see rates rebound after the first of the year. We remain with a locking bias to be safe.
Current outlook: locking bias