The U.S. economy got some good news this morning. Unemployment decreased from 8.1% to 7.8%. It’s great that more people are back to work. Personally, I know an individual who has been out of work for two years who received an excellent job offer this week, so that statistic hits home with me.
This good news has caused mortgage rates to rise.
Remember: bad news = lower rates, good news = higher rates.
We also know the market is anticipatory. And in this case, investors were taken by surprise by the lower unemployment. Hence, we expect mortgage rates go up.
For most lenders, rates on the 30-year fixed mortgage increased by 0.125% (1/8) to 0.25% (1/4).
I was consulting with a client yesterday about his home loan, and I strongly advised him to lock in his 2.875% FHA 30-yr fixed rate. I’m not always right predicting the future of rates, but turns out that was good advice. My logic was that the rate was so phenomenal, there was no reason not to lock and secure it. For more information about my consultation service, please see the “Review My Estimate” page on this site.
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