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What makes mortgage interest rates go up or down?

The simple answer is that mortgage rates are tied to the US economy.  I don't want to get too technical and explain mortgage backed securities and their relation to the 10 year US Treasury Bonds, which is the pool of funds that banks draw from.

I want to keep it simple by saying mortgage rates are tied to the current value of a US Dollar.  Inflation makes dollars worth less (higher rates) and recession makes dollars worth more (lower rates).  We're coming out of an extended recession and coming into an inflationary period.

The rule of thumb in a rising rates period is "the sooner, the better".

Posted by Dru Scott on October 11th, 2018 10:47 AM