Recently it was reported that interest rates were at record lows. 3.875 was a realistic rate with very little cost. This news brought many of you into the market as an engaged customer who figured all of the hassle of getting a mortgage might be worth it now. People are discouraged by their own experience in obtaining financing or by the horror stories reported in the media. Granted it is not an easy process and lending standards have tightened considerably but there are still ways to get a refinance accomplished with minimal "pain."

So the great news of historic low rates brought you into "search mode." Next you may have inquired on line and been bombarded with phone calls. Ultimately the rate quotes were not what you thought and the hassles at inception may have completely discouraged you enough to decide to stay where you are.

Interest rates move in cycles and change daily. Typically if the stock market is up, bonds are down and rates are worse. Since we hit a historic low in the 10 Yr. Treasury market of 1.67% the yield has since moved up as high as 2.38%. 10 Year Treasury rates have nothing to do with how a mortgage is priced but it is indicative of what is happening in the bond markets. We all know that stocks have been on a tremendous run and it is one of the best Octobers on record in the stock market.

European debt concerns have been calmed, 3rd quarter GDP was in line with expectation and nearly twice what was reported for the previous quarter and earnings season has pleased the markets. The result: Interest rates are higher than you thought (but still near historic lows around 4-4.25% depending on cost structure).

This is a good week to get your application in place and position yourself to lock in a low rate. Here's why:

There is a FED meeting this week and the policy announcement is due on Wednesday at 1:15 CST. In this type of environment the day after such a meeting typically brings the best rates and opportunity to lock in your rate. The FED has a major commitment to keeping mortgage rates low. They are a primary trader in this sector and their commentary and actions should benefit mortgage pricing greatly this week.

The European moves to calm their debt markets are not even close to what will ultimately be necessary. 1 Trillion Euros is not enough money to solve the problem. It isn't enough to solve the state of California's woes, how can it solve the sovereign debt woes of an entire region.

Our economy is in a soft patch. While the consumer seems to be more resilient than indicated by their confidence reports there are still a lot of concerns about economic growth and joblessness and while there is a lot of economic cheerleading going on, most economists agree that we are not out of the woods on the potential for another recession.

Those who get the best rates are the proactive ones who position themselves well before the market turns on them. Many shoppers hear about something in the media and then react. Often it is too late to catch the best pricing. If you would like to be proactive, get yourself in a position to lock on Thursday by applying on Monday. This can be done with no out of pocket cost and you will only incur an expense when you are satisfied with the terms of the loan and the appraisal is ordered. We won't even pull your credit report until we get to the point of locking (we need to know your score in order to execute a lock).