Rates Move Lower Again as Bond Demand Stays Strong

Posted To: Mortgage Rate Watch

The bond market is the main ingredient that lenders use to determine lending rates. The mortgage market is no exception . In fact, mortgages have specific bonds that dictate the prices of loans that sold between investors on the secondary market. Those prices let lenders know where to set their mortgage rates on any given day. There’s a longstanding belief that the 10yr Treasury yield guides mortgage rates as well. While that’s not exactly the case, longer-dated Treasuries (think 5, 7, 10yr) tend to move in relative lock-step with the rates implied by mortgage-backed bonds. As such, when “things” happen that help longer-dated Treasuries, mortgages tend to benefit as well, even if the timing and magnitude can vary. That’s exactly what happened . A scheduled 10yr Treasury auction showed very…(read more)

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Rates Move Lower Again as Bond Demand Stays Strong
Rates Move Lower Again as Bond Demand Stays Strong

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