Mortgage Rates Lowest in a Week After Starting Higher
Mortgage rates began the day in higher territory due to overnight weakness in the bond market. Bonds (like US Treasuries or the MBS that determine mortgage rates) move higher in yield when they’re weakening. Higher yields in Treasuries typically go hand in hand with higher MBS (mortgage-backed securities) yields with the latter being directly correlated to mortgage rates. With all of the above in mind, it was no surprise to see mortgage rates move up a bit as 10yr Treasury yields jumped from 4.92 on Friday afternoon to 5.0% at the start of today’s trading session. Rates stayed high for the first few hours, but bonds experienced a fairly strong rally between 10am and noon ET. 10yr yields fell into the mid-4.8s and MBS were soon in stronger territory versus last Friday’s latest levels. This allowed almost every mortgage lender to issue updated rate sheets with lower rates. In terms of MND’s index, we started at 8.01 this morning versus 7.97 on Friday afternoon. The intraday gains ultimately paved the way for a drop to 7.91. As always, keep in mind that this is an index value that represents an a effective top tier rate for the most ideal 30yr fixed scenario. It means that plenty of loans are being done at rates in the 8%+ range and many continue to be quoted in the mid-to-high 7s. Loans in the 7% range tend to have discount points or buydowns.