“SUCCESS IS HOW HIGH YOU BOUNCE WHEN YOU HIT ROCK BOTTOM.” (General George Patton) And after two straight months of losses, who wouldn’t call last week’s rally in Mortgage Bond prices a success? On this rally, home loan rates improved by about .125% across the board. So let’s take a look at what happened.

Mortgage Bonds got into the bouncing mood early in the week when foreign stock declines brought buyers into the US Bond market – the increased demand helped prices improve. Then softer economic data – especially on the job front – convinced Traders that inflation might not be as bad as previously feared.

Both Stocks and Bonds react to economic data and reports, which foretell the strength or weakness of the economy. Stocks tend to react positively to good economic news, where as on the other side of the coin, Bonds, and therefore home loan rates, tend to react positively to weak economic reports. The mother of all reports is the monthly Jobs Report. And last Friday the consensus of the country’s best economists had forecast 225,000 new jobs created during the month of March. But the actual number came in at 110,000 – less than half of what was expected! This sent a message to Traders that the Fed will probably not accelerate the measured pace of short-term rate hikes – at least until the end of June. Bond Traders loved it and acted like “Tigger”, as they bounced prices even higher at the end of the week, helping home loan rates improve.

AND SPEAKING OF GETTING BOUNCED…EVER BEEN KNOCKED RIGHT OUT OF A REAL ESTATE NEGOTIATION DUE TO A MULTIPLE OFFER SITUATION? WITH HOUSING REMAINING HOT DURING 2005, HERE ARE A FEW CREATIVE IDEAS THAT MIGHT HELP KEEP YOU FROM GETTING TOSSED OUT OF THE HOME OF YOUR DREAMS.

It’s going to be a lean, mean, carb-free week for economic news. And the “Atkins Approved” calendar is sure to leave Traders hungry, as the only Report of note will be Initial Jobless Claims on Thursday. But there will be a hefty buffet of Fed-speak this week (see special calendar below), which includes two full helpings of the Chairman himself – Alan Greenspan will be in the spotlight again on both Wednesday and Friday. Traders will be listening closely for clues on inflation and the pace of future rate hikes…any surprises can cause major market reaction.

The recent trend is favorable, but the ride may get a bit bumpy this week. The next technical ceiling of resistance is approaching and may halt the enjoyable bounce higher. If comments from the Fed raise fears of inflation, things could worsen quickly. Bottom line: Expect a modest improvement in home loan rates to start the week, but after that, the market will roll with the Fed.

“HOUSE” YOU FEELING? HOT, HOT, HOT!

And with nationwide housing remaining hot, many prospective homeowners may find the home of their dreams…but then find themselves in a bidding war against a pack of other salivating buyers. So if you’re in the market to buy a home and find yourself in the unenviable position of being in a competition against multiple offers, here are a few ideas that might help give you the edge.

Think Like a Seller. When a seller enters into a contract with a buyer, they want to make sure that the deal is going to close. For a seller, nothing is worse than to enter into an agreement with a buyer, turn away other offers, take the home off the market for 30-60 days…and then not close.

Conditions or contingencies on the buyer’s behalf create more risk for a seller in a contract. If you can minimize or eliminate any contingencies, you can make your offer stand out in the crowd. Contingencies can include approval for financing, the sale of a buyer’s home, home inspections, and appraised value, among others. Get home loan financing arranged in advance via a pre-approval with your trusted mortgage professional. Investigate ways to be approved without the sale of the buyers home being a necessity. If a home inspection is important to you, arrange to have it done very quickly.

Do the Bump. If you are in a bidding war, determine the highest price you are willing to pay…and bump your offer just a very small amount above that. Instead of increasing your offer $5,000, try $5,250. That $250 may just be the amount that takes your offer above the other buyers…and will get you the house.

Raise the Bet. Increase the amount you are willing to lay out as an escrow or earnest money deposit with your offer. Your real estate professional can tell you what is common in your area for the home value – so take it up a notch above that amount. If you are certain you want the house and know that you will close, increase the size of your deposit. A larger deposit will give your seller greater confidence that the sale will close.

Sweeten the Pot. Although it may sound a little warm and squishy, consider writing a cover letter to the seller explaining exactly why you love the home and want to make it your own. Although this is a business deal, remember that you are moving into someone else’s home, and emotions can run high. If you really feel strongly about the home, let the seller know…and keep your thoughts about immediately tearing out all the velvet floral wallpaper to yourself.

When making the decision to work in a multiple offer situation, tread wisely. Consult carefully with a skilled Realtor and mortgage professional that knows the market you are buying in. They can help you in positioning an offer that not only entices the seller…but also protects you.

If you like economic news, you’re going to hate the week ahead. But don’t worry…the lean economic calendar is offset by full plate of Fed-Speak.

All times listed in the table below are Eastern.

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

For the week of April 4 – April 8