Inflation and Mortgage Rates

Let’s talk about inflation and mortgage rates.  Inflation is the single biggest factor in interest rates.  The higher inflation goes, the higher interest rates will go.  Why is this? Who sets mortgage interest rates? It’s helpful to know that your lender is not lending their own money when they give you a mortgage.  Rather, they...

Rising Interest Rates – When Will it Stop?

But look what happened in the last year.  Margins have steadily declined as lenders expanded their operations to try to take advantage of the surge in business, but then business levelled off. 

Conforming Loan Limit 2022 – They Just Lowered Rates Again

Conforming Loan Limits 2022 Conforming loan limits are the maximum mortgage loan that Fannie Mae and Freddie Mac (the agencies) will purchase.  Why is this important?  When lenders make loans that they can sell to the agencies, the investors in those loans know that their investment is guaranteed by the U.S. Government.  Because of this,...

Interest Rates – What Happened?

Looking out over the next few months, most analysts are still predicting interest rates to show improvement.  They have risen too high too quickly, according to their argument.  This seems reasonable.

Did the Fed Just Lower Mortgage Rates?

Until lenders work through the surge in their pipeline, we won’t see lower mortgage rates. In my experience, this will take at least a month, possibly as long as three.

Interest Rates Plunge – Is There a Bottom?

Interest rates plunged over the last two weeks. The 10-year bond has never been this low in history. Margins have never been this high for lenders. Lenders are changing their pricing multiple times each day. We are in completely uncharted waters. What happens now? To be honest, we can only guess.

Why Are Interest Rates Dropping in February?

"...there is room for retail interest rates to come down a bit – somewhere between 0.125% and 0.250%"

Will Mortgage Rates Drop in 2020?

Look at the chart below. You can see that at the end of July and the beginning of August – the days after the Fed announcement – interest rates dropped steeply to their lowest level since 2016. Mortgage rates followed as expected.

Mortgage Rates Update

Mortgage rates dropped in late July and early August and have held quite steady since then. What happened, and what’s likely to happen next?

Fed Cuts Rates, But That’s Not All

What I am saying is that yes, when the Fed cuts rates it can influence mortgage rates somewhat, but because of their other decisions we are about to see dramatic improvement in mortgage rates very soon.