His advice: "Don't refinance yet."
Gross also said he sees two conflicting trends in the bond markets, with corporate bonds overtaking Treasurys as attractive places to invest money.
Watch Gross's interview at left.
"Treasuries have basically benefited from a flight to quality," he said. "On the other side, though, corporate bonds—for example, Caterpillar and Hewlett-Packard—their spreads are 5 percent more than Treasurys, and so, yes, there's an increasing attraction to the corporate bond market."
That said, he's not buying corporate bonds.
"PIMCO basically is still under what we call the government umbrella, and close to the handle," he explained. "Those would be assets, mortgage-backed securities, that the government has announced that they's going to be buying $500 billion of over the next few quarters."
Some time next year, he sees stabilization coming to the economy, and lower mortgage rates are an essential part of that process.
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Gross said the economy has undergone profound changes.
"The past 30, 40, 50 years, of a bull stock market was based, in substantial part, on a leveraged type of economy—where people borrowed more and more money, corporations and individuals, etc.," he said. "In addition, the regulation was lax, and on top of that, corporate taxes came down substantially."
All of those trends, he said, are about to reverse, and not just for the short run.
"I call them 'inter-generational changes,' not just cyclical, not for the next year or two, not even for the next two to five years, not maybe for the next 10, 20, 30 years," he said. "We have to factor those in to our pricing for stocks."