Market Analysis

The bond market opened significantly worse in response to a huge rally in the stock market.  Late in the afternoon though the bond market reversed course and rallied to a positive level.  There was no major economic reports released to support either move down or up.  What appears to be moving the bond market is a late afternoon rally in the dollar as investors are beginning to speculate that Fed rate cutting is either over or almost over and that the dollar is positioned for a rebound.  A stronger dollar makes long term bonds more attractive because yields/interest paid in dollars are more valuable once converted into home currencies for foreign investors.  The stock market rallied on more positive earnings reports from Google after trading yesterday and from Caterpillar early today.  Citibank reported more losses and write downs and their stock surged on hopes they have hit a bottom.  All in all we could not have hoped for a better end of what has been a horrible week for mortgage rates.  The late afternoon rally in the bond market in the face of a surging stock market was welcome relief.   Let's just hope the momentum carries through to next week.   Please note that if you lock with Iron Harbor and the market improves dramatically, we are able to renegotiate once and get within .375 points in closing costs of current market.  For example if the market improves to 5.625% with 0 points, we can renegotiate once to 5.625% with .375 points.  It is important to note that even though when renegotiating there is a .375 point adjustment to closing costs, usually we renegotiate rates to a rate sheet that is very short-lived and, therefore, most of our borrowers get a better rate renegotiating than if they were just trying to call in and get their loan registered and locked to start with.   If you think you may want to use Iron Harbor, we recommend having your loan set up and ready to go with us so that we can get your loan locked asap once you decide to use us.  The first step with Iron Harbor is to be pre-approved.  You can access a short application form at http://www.ironharbormortgage.com/xSites/Mortgage/IronHarbor/Content/UploadedFiles/Iron%20Harbor%20Short%20Application.pdf
Posted by Matthew Breston on April 18th, 2008 5:44 PMPost a Comment (0)
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