Mortgage Rates Appallingly Unchanged Relative to Market Movement
Posted To: Mortgage Rate WatchMortgage rates were roughly unchanged today. That’s an appalling reality considering the movement in underlying bond markets. Bonds–specifically, mortgage-backed securities (MBS)–are the primary input used by mortgage lenders in determining rates. As bonds improve, mortgage rates tend to improve as well. There can certainly be some input lag (i.e. bonds can move first and lenders need time to catch up or let volatility play out), but it’s rare to see substantial improvement in bonds and limited improvement in mortgage rates. Yet that’s just what we’re seeing today. What gives?! The first part of the issue is the relationship between MBS and broader bond markets. It’s common to see mortgages discussed in the context of 10yr Treasury yields because MBS and 10yr Treasuries behave similarly over…(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.