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Saturday’s: 9AM 1590 AM/97.9 FM KVTA
Sunday’s: 7AM K-EARTH 101 FM
WRAP UP
UMBS 6.0: 99.58 (-33bps)
10yr yield: 4.33
Well, that’s a wrap. It’s tough to come up with any reason to be floating here that doesn’t include hoping and praying… hoping the Fed meeting and press conference go our way, praying rates fall a bit. I’m not saying it can’t happen, I’m just saying that I don’t think it’s likely. Advice remains to lock em.
Rate sheets today likely to be a bit more erratic than usual but will still be worse on the day than yesterday as mortgage bonds bounce around. Reprice risk is moderate, we’ve seen bonds slow down in the afternoons the last few days, and that could happen again, but some lenders may either improve or worsen pricing when it does. The outlook remains the same, only a dovish Fed next week is going to help rates improve, and that wouldn’t likely be for more than .25% if we were lucky. The risk to floating just not worth it in my opinion, as rates have stagnated.
Loans closing in less than 15 days should not be considering the gamble of waiting to see what next week’s Fed meeting brings. Lock these loans up, even if you wait a bit until later today to do it.
Loans closing in 15-30 days should consider locking. Loans closing in October that are risk averse should simply lock. However, those looking to gamble and see just what the Fed meeting brings shouldn’t get hurt too much between now and then. I don’t think this Fed meeting is going to help rates much, but the possibility is there. We’ll talk more about it next week.
Loans closing in 30+ days have the least urgency to lock (but should still consider locking). Like I said above, I don’t think that the Fed meeting is going to help much, but the opportunity is there for those that want to wait and see.
Technicals:
The UMBS 6.0 coupon is at 99.75, -15bps on the day.
The 10yr Treasury yield at 4.31.
