If you’re closing your loan after Friday, I left you unlocked.  I told you
that the fundamentals of the economy would bring rates lower after the bailout
was announced.  Long Beach mortgage rates were at 5.875%, today they’re at
6.5%.  What’s in store for the rest of the month?

Eric Holloman of Rate Link offers this two-minute
research report about why “headline risk” should be replaced by economic
data as a determination of mortgage-backed securities pricing.  If he’s
correct (and I think he is), the next three days will be important for the
direct of mortgage rates through the end of the year.

I’m still recommending that you float your mortgage rates; I
believe we’ll see rates come back down under 6% within the next 7-10 days.  If
the economic data suggest that we are NOT headed for a recession, Long Beach
mortgage  rates will stay in the 6.25-6.75% range.  If the data are as
indicative of a downturn as I think they will be, lower rates should be on the
horizon.  As always, keep checking back.