New 2017 Lows for Rates, But There’s a Catch

Mortgage rates fell to new lows for the year today, following the North Korea nuclear threat headlines. In truth, the preceding sentence gives too much credit to geopolitical risk. Rates were already drifting very close to the lowest levels since the election, even before yesterday’s news broke. Additionally, the improvements are still too small to be translating to NOTE rates themselves (the actual interest rate applied to your loan balance). Instead, it’s the upfront costs that are allowing for fine-tuning adjustments. (This means the EFFECTIVE rate is changing, but not the NOTE rate.) The bonds that underlie mortgage rates tend to stick pretty close to US Treasuries. That wasn’t the case …
Mortgage Rates Newsletter – Market Analysis

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