Mortgage Rates Balking at New Record Lows

Mortgage rates have improved nicely over the past week.  While a lot of this improvement is due to the delay of the new refinance fee announced earlier this month, the broader bond market has helped.  For instance, 10yr Treasury yields–often viewed as a benchmark for mortgages and other long-term rates–have fallen every single day since last Friday.  When 10yr Treasury yields are falling, mortgage rates typically fall in rough proportion.
When it comes to that general rule linking Treasury and mortgage rates, 2020 has seen the biggest exceptions in history.  There were two reasons for this at first.  The mortgage bond market wasn’t nearly as capable of coping with heavy volatility in March for a variety of reasons.  Lower relative demand for mortgage bonds means that mortgage rates will move higher relative to Treasuries, all other things being equal.  That issue is ancient history now, however, as the Fed’s bond buying campaign has soothed markets enormously. …(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.
Source: mortgagenewsdaily.comNew feed