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mortgage rates

Compare the best mortgage bank rates along with Canada's best mortgage rates, insurance quotes, and banking & investment products with Rates4u.ca

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mortgage rates

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  1. mortgage rates Published by: rates4u

  2. How Are Mortgage Rates Determined? Most people have no idea how mortgage loan rates are calculated or what causes them to fluctuate, and those who believe they do are typically incorrect. As a former mortgage banker, I can tell you that a lot of individuals in the business couldn't even answer that question accurately. So, what's the deal with the mystery and misinformation? Let's take a quick look at what influences mortgage rates and (just as crucial) what doesn't. If you ask a group of friends what mortgage rates are based on, they will say they don't know, but it has something to do with Ben Bernanke and the Federal Reserve. Some of your more financially knowledgeable pals may tell you that interest rates are determined by the yield on a 10-year Treasury bond. Both of the responses are wrong. The reality is that mortgage rates are determined by the market for mortgage-backed securities (MBS). This is beginning to sound a little frightening. I'll try to keep things simple, so here's a short rundown of what a mortgage-backed securities is. Banks and mortgage lenders pool significant amounts of their mortgage loans in order to sell them as investments. Bonds are used to exchange these debt commitments (mortgage backed securities). An investor may put money into a pool of mortgage loans and earn money depending on how well they perform (do they pay on time etc...). The market for mortgage-backed securities is a subset of the bond market. The MBS market, like the broader bond market, responds and fluctuates in response to economic news and indications.Do you want to learn more? Visit current mortgage rates To take it a step further, for those of you who are familiar with financial issues, here is the technical explanation. Variances (or spreads) between MBS rates and a financial derivative product called interest rate swaps directly influence MBS rates, and therefore mortgage rates. Investors utilize these swaps to manage, hedge, or speculate on risk. A swap rate is a fixed interest rate received in return for the risk of paying the short-term LIBOR (London Interbank Offered Rate) rate over time. Mortgage rates are also affected by interest rate swaps and treasury notes' respective spreads.

  3. So, why do so many people believe the Federal Reserve is in charge of mortgage rates? I'll take your estimate as good as mine. The most probable reason is that ignorant members of the media continue to report that the Fed has reduced interest rates and that mortgage rates would follow suit - and we continue to listen. The truth is that the Federal Reserve's activities do have an effect on mortgage rates, but it is indirect and often delayed. When the Federal Reserve announces a reduction in short-term interest rates, certain kinds of consumer loans, such as home equity loans and credit cards, are immediately affected. Have a look at best mortgage rates to get more info on this. It also has a detrimental impact on saving accounts such as money market accounts and certificates of deposit (because those rates go down as well). However, it has no immediate or direct effect on mortgage rates. The Fed's relaxing (dropping) short-term rates has an indirect effect on mortgage rates since it encourages investors to leave assets like money markets and CDs and put more money into the stock and bond markets. Bond prices increase when more individuals purchase bonds (including mortgage-backed securities). When the price of a bond rises, the yield on that bond falls. Mortgage-backed securities with lower yields have lower rates. This sequence of events, which began with the Fed cutting rates and concluded with mortgage rates falling, may take months to play out, and hundreds of other economic factors could interfere and prevent the chain from unfolding as expected.If you wish to learn more about this, visit lowest mortgage rates. Summary Influencer Index is a trading app crossed with your favorite social media platforms, allowing fans to invest in their favorite influencers and giving influencers, of all genres, a way to monetize their fandom and grow their market value. Visit this site to learn more: https://influencerindex.com/

  4. Summary Compare the best mortgage bank rates along with Canada's best mortgage rates, insurance quotes, and banking & investment products with Rates4u.ca Visit this site to learn more: https://www.rates4u.ca/best-mortgage-rates

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