No rate drop - follow up

The treasury auction didn't do as well as most anticipated. Who knows why, it could be because half of the east coast is under 3 feet of snow and no one went to work?

Bottom line is that we're just about where we were a week ago. I still hold out for a swing down. But as I've been telling clients lately, let's take a step back and look at the big picture. "So you don't get 4.875%?" Is there something wrong with 5% or 5.25%? I don't think so. Let's remember pigs eat and hogs go to the slaughter (or something like that, but you know what I'm getting at).

I don't believe this next item to be what will happen but the Fed is supposedly slowing down on its buying of MBS (mortgage backed securities). This will probably cause rates to rise by a percentage. Like all things lately, if the Fed does this and rates go up, I think we're going to be in for a big disaster. One of the few REAL green "shoots" that are propping up our economy is the fact that rates are low which encourages purchases and refinances. Just like the housing credits, which they actually expanded who can qualify, I feel they'll see the light and continue the buying of MBS through the end of the year. But you never know.

My suggestion is let's capitalize on these great rates and not try to gamble and get the very bottom. Let's get loans in and closed out. Because you don't want to be someone who missed the boat because you HAD to have a rate in the 4's instead of 5%, which probably is only a $25 - 50 per month difference.