Mortgage rates are notoriously unpredictable, but they respond reliably to economic news: the Fed raising rates.
The biggest economic news of the week came on Wednesday, when the Fed’s Federal Open Market Committee concluded its June meeting with another rate hike widely expected. In March, the Fed raised rates for the first time in years, followed by another hike in May. Both actions are an acknowledgement of overheating inflation. Inflation data for May was as high as 8.6%.
The sharp rise in inflation over the past year has actually forced the Fed to raise interest rates. Skeptics say the central bank has been slow to respond to the highest inflation in decades.
The central bank has also scaled back economic stimulus from the pandemic. The Fed buys $120 billion worth of Treasuries and mortgage-backed securities a month, but has begun to slow the pace of purchases.
However, it’s unclear whether mortgage rates will change on the news of the hike — almost everyone expects rates to rise 0.5 percentage points this week, which is what mortgage rates are expecting.
The Federal Reserve doesn’t directly set mortgage rates, and calculating how much you’ll pay on a home loan is complicated, but here’s a simple rule of thumb: A 30-year fixed-rate mortgage accurately tracks the 10-year Treasury yield. When that rate rises, popular 30-year fixed-rate mortgages tend to do the same.
Лихвите по ипотечните кредити с фиксиран лихвен процент се влияят и от други фактори, като търсене и предлагане. Когато ипотечните кредитори имат твърде много бизнес, те повишават лихвените проценти, за да намалят търсенето. Когато бизнесът е слаб, те са склонни да намалят цените, за да привлекат повече клиенти.
The interest rate is ultimately determined by the investor who purchased your loan. Most U.S. mortgages are packaged as securities and resold to investors. Your lender offers you an interest rate that secondary market investors are willing to pay.
