Timing the 10 year for mortgage lock

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
Post Reply
Topic Author
JaxFLbh
Posts: 62
Joined: Thu Jul 22, 2010 7:37 am

Timing the 10 year for mortgage lock

Post by JaxFLbh »

Bernake speaks tomorrow. Rates are at a 2 year high. Could he possibly say anything that might send the 10 year higher? It seems to me he'd like to be more of a dove. I ask because I need to lock in a mortgage rate within 30 days :)
User avatar
ogd
Posts: 4876
Joined: Thu Jun 14, 2012 11:43 pm

Re: Timing the 10 year for mortgage lock

Post by ogd »

Your lender is eagerly anticipating this speech too. In fact, they're probably paying Thomson-Reuters for a 2 second head start :) (Google it)

I'd say the chances of you outmaneuvering the professional MBS investors are probably nil. And I say this having done just that, by pure luck...
User avatar
TomatoTomahto
Posts: 17158
Joined: Mon Apr 11, 2011 1:48 pm

Re: Timing the 10 year for mortgage lock

Post by TomatoTomahto »

IF you could time this, it would be sad to waste it on a mortgage lockin.
I get the FI part but not the RE part of FIRE.
User avatar
G-Money
Posts: 2867
Joined: Sun Dec 09, 2007 6:12 am

Re: Timing the 10 year for mortgage lock

Post by G-Money »

I'd look at this behaviorally. How would you feel about each of the following:

1. You lock the rate now, only to see rates drop 50 bp tomorrow.
2. You wait to lock, rates rise 50 bp and don't come back down within 30 days.

Therein lies your answer. (If you'd feel equal amounts of regret in either scenario, then I recommend you flip a coin).
Don't assume I know what I'm talking about.
Topic Author
JaxFLbh
Posts: 62
Joined: Thu Jul 22, 2010 7:37 am

Re: Timing the 10 year for mortgage lock

Post by JaxFLbh »

Well said G-Money. I'm willing to gamble I think :)

Im expecting the Bernake we got a couple weeks ago when he had to make unscheduled commentary to calm the bond selloff.
User avatar
Rainier
Posts: 1733
Joined: Thu Jun 14, 2012 5:59 am

Re: Timing the 10 year for mortgage lock

Post by Rainier »

Why wouldn't you lock with a float down option?
User avatar
kenyan
Posts: 3015
Joined: Wed Jan 12, 2011 11:16 pm

Re: Timing the 10 year for mortgage lock

Post by kenyan »

Don't know about the OP, but those options don't always exist (for a particular lender). It didn't exist for us.
Retirement investing is a marathon.
Topic Author
JaxFLbh
Posts: 62
Joined: Thu Jul 22, 2010 7:37 am

Re: Timing the 10 year for mortgage lock

Post by JaxFLbh »

I've asked that of the 4 lenders i've inquired with. None of them offer float down. Just float. I didn't lock in today, so I will probably just let it float for as long as I can.
Post Reply