Financial Insight

 The Senate is expected to soon vote on more mortgage-related legislation. Given that, according to the story, 1.5 million subprime adjustable rate mortgages are due to reset in 2008, lawmakers are feeling the heat. http://money.cnn.com/2008/04/01/news/economy/senate_surpr_move_foreclosure/?postversion=2008040118

 Rates were slightly higher yesterday following an ADP jobs report and Bernanke’s testimony in front of Congress. Interestingly, Bernanke’s testimony caused the market to adjust expectations downward toward 0% for a 50 basis point rate cut. And overnight, the second largest German state bank reported $6.7B in write downs, bringing the total to $232 billion. The only news out this morning was the usual Thursday Jobless Claims, but with unusual results: the number of U.S. workers applying for unemployment benefits shot up by 38,000 last week to 407k. This is the highest level since late 2005 and reinforcing fears that the U.S. economy has stalled. So bonds and mortgages have improved this morning based on investors thinking that the ADP number from yesterday, which doesn’t include government jobs and whose history of predicting the actual employment picture has been spotty, may be misleading again.

 Later today the ISM non-manufacturing reading is expected to decline by 0.8 to 48.5 (anything below 50 signals “contraction”). Tomorrow we’ll see the unemployment data, with Nonfarm Payrolls for March expected -50k versus last month’s -63k and the Unemployment Rate expected to rise to 5.0%. With all of this going on, mortgage prices are better than yesterday afternoon by roughly .250, and the 10-yr is back into the mid-3.50’s.

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