Mortgage Rate Shopping? – Keep your finger on the trigger

For all you consumers attempting to time the market and get the very lowest rate available, I have a few words of advice. Find your target rate, put your finger on the trigger and be ready to lock at a moments notice. Monday was an amazing day for mortgage rates. Well, the morning was… and then the rate changes for the worse began arriving by email from investors. This morning rates opened up even higher and indicators tell us rates will continue to worsen.

There was a time not so long ago when I could accurately predict rate changes and offer up advice to my clients when to lock or float their loan. The 10 year bond was always a trusted friend when following the market. As a rule, good news in the economy translated to a good day in the stock market and a bad day for interest rates. Bad economic reports would always pull money from the market to the safe haven of treasuries and cause mortgage rates to drop. But these days nothing seems to make sense anymore.

Many American homeowners, at least the ones who qualify with the BIG THREE – income, credit and equity – have refinanced sometime in the past year or so. But mortgage rates continue to fall and refinancing yet again could make sense and save a ton of money over the lifespan of a loan. The difference between a deal that makes sense and saves money vs. a deal that makes no sense could be 1/4 of a percent in rate. Between yesterday morning and this afternoon, if you did not lock your loan, you could be looking at a rate anywhere from 1/4 to 1/2 point higher in rate. In mortgage rate terms it could be the difference of 3.75% vs. 4.25%.

If your current mortgage is 5.25%, based on the assumption above, you just removed yourself from the marketplace and are left hoping for another drop in rates. Is that drop in the future? Many seasoned pros I have talked with claim lower rates are a good possibility. My point is this – If a deal makes sense, do it! Make believe loans do not save you money, closed loans do. Find yourself a highly skilled and experienced mortgage banker, create a plan together and when your strike rate is available, lock it!

Timing is everything in the mortgage rate market. Don’t miss out….

5 Top Reasons to consider a refinance – click here