Tuesday, November 24, 2009

FLOAT OR LOCK? Daily Market Update and Recommendation - Nov 24th, 2009

Current Pricing of FNMA 30 Year 4.5% Bond: $102.22
+22 bps (Prior Close – $102.00)

Market Update: Mortgage Backed Security (MBS) pricing is higher today from yesterday's close. Bonds (including MBS) are benefiting from the carry trade, where investors borrow money at a low rate then leverage that money into high yielding investments.

Economic News: Preliminary Gross Domestic Product (GDP) reading for the 3rd Quarter was reported in line with expectations, while Consumer Confidence was reported slightly better than expected. Also, the Federal Housing Finance Agency reported a slight rise in U.S. home prices in the 3rd quarter. The Phoenix-Mesa-Scottsdale area seems to be leveling off, showing only a -5.50% drop. Click here to view the full report.

Recommendation: FLOAT

If you're considering purchasing or refinancing, contact The Krushinsky Team at 602-695-7575 or email david.krushinsky@wjbradley.com to find out how to take advantage of today's best loan rates.

The decision to float or lock your interest rate can save, or cost, you thousands of dollars over the life of your new mortgage. Our recommendation doesn't apply to all borrowers, so if you have questions please contact us directly.

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