4 March 2011 – I usually like being right. In my last update, I addressed the fickleness of markets and advised that the lower rates of late could be a fleeting affair. Based on the events of the last week, the turned out to be more prophecy than prognostication as we saw the week end with a reversal of the recent downward trend.

Oddly enough, the shift to higher mortgage pricing was not due to a settling down in the Middle East. Rather Qaddafi—OPEC’s Charlie Sheen—continued his rants as a mass migration of refugees toward his borders created a pending humanitarian crisis. Markets, however, are worried about oil and data reflected no major decrease in regional oil production since Libya’s problems began. Additionally, employment here in the U.S. seems to be once again on the mend as jobless claims reached a three year low.

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There are still some possibilities that the trend could move back to a favorable direction. Jordan still has not fully resolved their issues and Saudi Arabia, which has up until now managed to avoid the groundswell of democracy, is showing small cracks. Petitions to the king openly requesting changes have been met with nothing but the offer of cash. Unappeased by this colossal multi-billion dollar offer, preparations have begun for a March 11th protest. Although this is against Saudi law, this may not be enough to stem the tide and a violent response on the part of the monarchy could set off a conflagration. This would likely affect oil and touch off another flight to safety.

My mortgage rate lock advice is now once again defensive in nature. I am now recommending that my clients closing in 7 – 15 days to LOCK. I believe those closing 15 or more days still have some opportunity with FLOATING a better option.