10 September 2010 – Since last week’s use of Einstein’s quote was so well received, I thought it appropriate to begin this week’s commentary with a quote from the venerable Yogi Berra. Yogi remarked after seeing back-to-back home runs by Mickey Mantle and Roger Maris that it was “déjà vous all over again.” Such was the week in rates, with a drop followed by a return to the mean of the last month.

The week started very strong for mortgages with rates for Fannie Mae and Freddie Mac conforming loans dropping in response to the Treasury Department’s debt auctions. Thursday, however, brought some positive economic news in the form of a reduced trade deficit and lower unemployment numbers. That said, rates for 30-year fixed rate mortgages vacillated in a range of 4.25% to 4.5% for most lenders.

cheapest cialis daily price

HOW CAN I TIME THE BOTTOM?

The see-saw effect that we are currently seeing in mortgage rates does provide me the opportunity to shed some light on the psychology of locking and the eternal quest to secure the absolute best rate ever. Luckily, Mr. Berra provided some applicable wisdom here as well. He said “when you come to a fork in the road take it.” Locking a mortgage rate is this fork, but, instead of acting, many of my clients become paralyzed with trying to time the market. In truth, the absolute best rate is the Holy Grail of lending and it is nearly impossible achieve without a massive amount of luck. You will likely only know the bottom after it has passed. So when faced with this quandary, take the information that you have regarding rate trends, make a decision on whether or not you are getting a rate in the low range and move on.

I am recommending any of my clients closing within 15 days to LOCK their rates due to the unpredictable nature of the market. For clients closing more than 15 days from now, I am recommending FLOATING with very keen eye the market for LOCK opportunities.