Rates went up last week!

How can that be when the Federal Reserve Bank lowered interest rates?

It is a good time to reflect on what drives mortgage rates. Mortgage Backed Securities are the key to mortgage interest rates. Obviously the rates are affected by many different factors and this last week despite the lowering of interest rates, the stock market rose dramatically and long term bonds (10 year) were not garnering the interest they had. The dollar dropped significantly against other foreign currencies, oil prices rose and suddenly mortgage backed securities are not as attractive an investment so interest rates rose to counter this.

Robyn Robertson

Suburban Mortgage Inc.
Phone 480 355 8106
Cell 480 415 2336

September 24, 2007 by Realtor John Wake

About The Author

John Wake

Born in Phoenix, trained as an economist and now a licensed Realtor, John uses hard data from the real estate market to help his clients -- buyers and sellers of residential real estate -- uncover their best choices for finding the right home or finding a buyer for their current home.

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