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Financial Fitness

September 17th, 2011 9:10 AM

This week a real estate agent asked me why their client had locked in their loan AFTER rates had gone up on Thursday unexpectedly. She said rates are always going up and down and I should lock it when they are down. The problem is that you don’t know where “down “is until they are up. Because I monitor rate charts, I knew that the 10 year Treasury had broken through a resistance level making it more likely that rates would continue their upward trend plus my rate advisors were predicting even higher levels. No one can know where rates are going to be tomorrow, so we take educated guesses. I had explained that to my client and he decided to not take a risk because it was still a very good rate. As it turned out rates did continue to go up on Friday and my client was very happy he locked on Thursday. Another client who locked on Tuesday said it well, “I like the rate and would rather say ‘Oh well’ if they go down after I lock than ‘Oh _ _ _ _’ if they go up and I didn’t lock.” Well said.

Posted by Cary Brooks on September 17th, 2011 9:10 AMPost a Comment (0)

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