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 If you are considering locking in an interest rate for a New York or Florida property, read this post.

Monday’s bond market has opened in negative as Friday’s selling extends into this morning’s trading. The stock markets are not helping as they are posting sizable gains. The Dow is currently up 88 points while the Nasdaq has gained 25 points. The bond market is currently down 8/32, which will likely push this morning’s mortgage pricing higher by approximately .250 - .375 of a discount point from Friday’s morning levels.

There are only two pieces of monthly economic data scheduled for release this week and neither comes today. Nothing of relevance is scheduled for today or tomorrow, so look for the stock markets to be the biggest influence on bond trading and mortgage rates until we get to Wednesday afternoon.

Wednesday doesn’t have any economic news scheduled, but does have a speaking event for Fed Chairman Bernanke and the first of this week’s two relevant Treasury auctions. But these will be the first important events of the week that could affect the bond market and mortgage rates. Mr. Bernanke’s congressional testimony before the House Budget Committee will be late morning, while the results of the 10-year Note auction will be posted early afternoon.

Overall, despite being an extremely light week in terms of economic releases and relate events, it is still relatively crucial for the mortgage market. We saw the yield on the benchmark 10-year Treasury Note break above 3.50% and close at 3.65% last week. This should be of concern for mortgage shoppers as the 10-year was trading in a well defined range until late last week. Since mortgage rates follow yields, we need to see some stabilization very soon or yields (and rates) may be moving higher. I suspect it will be tough to fall below 3.5% unless we get some unexpected major news or a significant stock sell-off. Therefore, please be careful if still floating an interest rate this week as I believe we are set for a noticeable move in the very near future. However, the question is if it will be rates moving higher or lower from current levels.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

 Empire Home Mortgage inc. is a registered Mortgage Broker with the NYS Banking Dept and our loans are arranged through third party providers.

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