Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on February 4, 2009

Locking Stance: LOCKING    Mortgage Bonds: 0bp

What a day MBS had yesterday, having been flat for most of the day, then dropping to close down 50 basis points, or 31 basis points below when lenders originally began pricing yesterday.  That means you are seeing higher mortgage rates this morning, if not yesterday afternoon.  This is a good example of while mortgage rates may improve slightly, I hold a locking stance as pressures can, and will, send them higher quickly.

This morning has some data plays involved.  In fact, two have already come out, the MBA Purchase Applications and the ADP Employment Report.  The ADP report has been taking on a greater than usual role in recent months as traders use it to predict Friday’s jobs data.  The problem is that it can be way off and is not a very accurate predictor.  Nevertheless, the ADP report came in at -522,000 with December’s being revised upward to -659,000 from -693,000.  The prior month is always revised heavily, so that is of no real surprise.  Now, the -522K number did beat expectations, so that may put more selling pressures on mortgage backed securities today.

The only other reports we have coming up is the ISM Services Index, due out at 10:00 and Crude Inventories (EIA Petroleum Status) due out at 10:30.  Neither one typically makes major moves in the markets, so beyond this morning’s data, news will likely be the major player.

What does this mean for Florida Mortgage Rates?  Mortgage rates will continue to favor movement higher, though a correction of sorts cannot be ruled out.  Without government intervention, we will not see significantly lower mortgage rates.

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