Stock and bond markets both took dives last week in response to anticipated rising interest rates. This is unusual because bonds typically remain stable as "safe" investments during dramatic shifts in the stock market. As we all know, the markets don't care for "surprises” and when Congress approved the increased budget and debt ceiling--they didn't like it.

 

Meanwhile, investors are eyeing the increased U.S. borrowing ($1 Trillion) that will be required to offset the growth in spending. We were already expecting a rise in Treasury debt issuance given the changes in Tax Code, but the additional spending is turning heads as this could drive higher rates. I think we're going to see on-going ramifications from these events over the next few weeks until things settle down.

 

The message? If you haven't Refinanced--now is the time. I do think rates will go up gradually but if you, or your clients, are in a higher interest product, now is the time to make a change.

 

Geoffrey Davis

Mortgage Loan Officer

NMLS #206192

geoffrey.davis@Movement.com

Cell: 214-529-9622

6801 Gaylord Parkway #202

Frisco, TX 75034