Happy Monday. I hope you had a fantastic weekend. Last week I recommended locking and that was followed by some down days in the market which meant rates were rising. Most experts thought that the EU would agree to a package that would give Greece about 5 months come up with a way to begin paying back their debt. Several ideas were floated and all indications were that a deal was basically in place. As of this morning it looks like Greece is going to default on their payment to the IMF tomorrow since their creditors have rejected Greece's proposals. Greece's banks are closed this week and Greece is now considering a referendum vote on accepting creditors' proposals or to leave the EU.
Like always with geo-political instability, there has been a flight to quality this morning as investors are buying treasures and mortgage backed securities which is pushing prices higher and rates lower. If you didn't lock last week, locking now would get you about the same pricing as when I recommended to lock. There is a decent chance that rates will improve throughout the week as long is there is no resolution to the Greece debt problems so floating may be a good idea. You may also want to lock now and if there is enough improvement throughout the week, you can float down.
A few other things to keep in mind is that the 1st resistance level is 102.68 and the benchmark bond is currently 19 basis points above that at 102.87 and is at it's high for the day. Closing above this line, and better yet, above the 2nd level of resistance at 102.92 could set the week up for some nice gains - especially if there is no resolution for Greece. I would float. As always, watch the market closely so that you can move quickly if necessary. Make it a great week and feel free to call me if I can help with anything mortgage-related: 702-812-1214.