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Mortgage Rate Volatility and New Record Lows

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Global unrest became the latest player to affect mortgage rates this week in what was already expected to be an especially volatile week given the S&P credit down grade of the United States a week ago.

Riots in London and increased concern about the health of European markets brought yet another layer of doubt into the fold that helped propel mortgage rates to yet new lows for the year.

Demonstrating the concern about stability In Europe, France and Italy have actually passed a ban on short-selling for the next 15 days. Short selling is trading that is essentially betting against the markets, an activity that may contribute to creating even more downward pressure on already weak markets.

Record Lows For Consumer Confidence

Negative economic data, global unrest and a weak economy are not lost on the public at large as the Thomson Reuters/University of Michigan preliminary index of consumer sentiment released data this morning.

Consumer confidence dove to 54.9 from 63.7 the prior month among U.S. consumers, reaching the lowest level since May of 1980.

The Upside to All of The Negative Market News and Data

The silver lining in negative economic data and unhealthy and unstable markets in the United States and Worldwide is low rates. In times of uncertainty, investors take money from stocks and equities and put it to work in safer vehicles like bonds. The end result is that this will usually result in lower mortgage rates, as is the case now.

The record low rates of today are not guaranteed to be available tomorrow or even later today, these markets are VOLATILE. Do not gamble with locking in a low rate, we can help you find the right loan for your needs and lock in a low rate to insure you are able to take advantage of the current window of low mortgage rates.

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Derrick Evans has written 3114 articles on GI Home Loans


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