High Unemployment Helps Mortgage Rates

by Tyler Osby on June 7, 2008

Today’s (June 6th, 2008) unemployment rate report came out and really moved the markets.  The report revealed the sharpest decline the United States has seen in 22 years.  Yea, not so great.  The actual unemployment rate moved to 5.5%, a full 1/2 percent higher than last month.  Again, the largest increase since February of 1986.  Again, keep in mind this report is for the entire US.

After the report came out, the stock market sold off (DOW closed down 319pts).  As we’ve mentioned in the past, ugly reports are actually good for mortgage rates.  After the news came out, mortgage rates closed up about .125% better.

Today’s report reinforces the importance of working with a mortgage planner that can explain the advantages of locking and floating an interest rate.   A great question to ask a loan officer when shopping for home loans is, ‘Do weak unemployment figures help or hurt mortgage rates?’.  Before you get this far though, you may ask the loan officer what economic reports are coming up the following week.  If they can’t answer that much – run to a lender that does!

{ 2 comments… read them below or add one }

Susan Kennedy June 7, 2008 at 1:05 pm

Even though unemployment is up, there are still thousands of $75K, $100K and $150K jobs.

http://www.realmatch.com
http://www.monster.com
http://www.careerbuilder.com

If one person looks for a job, they will find one, one person is not a statistic.

tylerosby June 8, 2008 at 1:22 am

Hey Susan!

Thanks for joining the conversation. I agree, there are tons of opportunities. Here in Iowa, we actually have a surplus of jobs right now. Nationally, the numbers are down a bit. Thanks for the resources.

Keep coming back!

Leave a Comment

{ 2 trackbacks }

Previous post:

Next post: