Posted To: Mortgage Rate Watch

For most lenders, mortgage rates improved again today, adding to the 3-week lows achieved yesterday. We normally view mortgage rate movement primarily as a function of the bond market, but the bond market says rates should only be falling modestly from their recent highs. What gives? This is a 2 part issue. First , there’s a difference between the overall bond market and the bonds that underlie mortgages. So-called mortgage-backed securities (MBS) did a better job of holding their ground in August when compared to the broader bond market via the quintessential 10yr Treasury yield. Second, and more importantly, the delay of the recently announced adverse market fee (an abrupt hit to all conventional refinances that unintentionally also affected purchase rates) is responsible for the lion’s share…(read more)

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Source: Mortgage News Daily