Re: mortgage rate lock?
The main point is that there is a 60% chance of a quarter point increase in November and a virtual 100% chance of a quarter point by December. There's also a small chance of a quarter point at each meeting. So you are paying the quarter percent no matter what. So what is the value of protecting against an additional quarter percent? It's about $310 per $100,000 in loan. So if you have a $200,000 mortgage you would save $620 present value ($15/month on a 30 year loan) So you'd be paying $1000 for the chance to save $620... probably not a good deal. IF the loan is $400,000 the potential savings is now $1240... a much bigger number but since the markets tell us that a half point increase isn't particularly likely I stillwouldn't do it. You'd probably ahve to have a loan size of over $500,000 or so to really consider locking.
Good luck.
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