Florida Mortgage Rates – Midday Report

by Florida's #1 Mortgage Planner on October 3, 2008

Locking Stance:  LOCKING     Mortgage Bonds:  -22bp

What a day we are having in the markets with news overwhelming data once again in what appears to be a never ending saga of bailouts, failures and takeovers. 

Wells Fargo announced a $15 billion takeover bid for Wachovia, which Wachovia jumped at and said goodbye to Citigroup’s offer.  Citigroup is now threatening to sue Wachovia as a result.  The House is set to vote on the bailout bill that the Senate just passed, so traders are looking for that outcome as well.

All of the news overshadows the jobs data which, for the most part, was bond favorable this morning.  As I have eluded to several times this week, emotions are running the markets and that never leads to a good outcome and we can see that happening as mortgage rates are climbing today. 

The charts are now painting a rather gloomy picture again, which they had been for several days when bonds dropped below their 25-day moving average.  If you have been reading my reports, you knew already that today will be pivotal for the future of mortgage rates as bonds needed to rally today or we would be seeing mortgage rates heading higher for the foreseeable future, which is now looking very likely.

The day is not over by any means, but odds are no longer in mortgage backed securities favor.  Lock those loans if you haven’t already as we may be seeing the beginning of mortgage rates climbing considerably higher over time.

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