Here are few developments happen today in financial markets due to uncertainty environment, and coronavirus pandemic’s impact on the economy is unknowable, Federal Reserve Chairman Jerome Powell made few announcements
- In the most drastic actions since the 2008 financial crisis, the Federal Reserve Sunday afternoon announced it cut its benchmark interest rate to near zero
- In addition to the interest rate cut, the chairman announced the Fed will buy $700 billion in assets – $500 billion worth of Treasuries and $200 billion worth of mortgage-backed securities to provide liquidity to financial markets .
- It would lend banks $1.5 trillion to prop up the struggling repurchase market that many companies use to borrow short-term debt.
Forecast plus what’s will be driving mortgage rates tomorrow:
- Major stock indexes future sharply down. (Good for mortgage rates.) When investors are selling shares they’re often buying bonds, which pushes prices of Treasurys up and decreases yields and mortgage rates.
- Gold prices moved up to $1,546 an ounce from $1,515. (Good for mortgage rates*.)
- Oil prices edged up to $31.14 a barrel down by 1.86% (Good for mortgage rates*)
- The yield on 10-year Treasurys will move lower moved tomorrow
Mortgage Lock Recommendation:
We suggest that you lock if you’re less than 30 days from closing*.
Lower mortgage rates ahead?
Moving ahead in year, there will be probability of getting lower rates, so stay tuned with our platform more updates.
Bearing in mind professor Galbraith’s warning, I personally recommend:
- LOCK if closing in 30 days
- FLOAT if closing in 45 days
- FLOAT if closing in 60 days
But it’s entirely your decision at your personal judgement on your risk assessment.
Only you can decide
Of course, financially conservative borrowers might want to lock immediately, almost regardless of when they’re due to close. After all, current mortgage rates are at or near record lows and a great deal is assured.No tags for this post.