Mortgage Rate Price Tracker 🏠📉🔍 (MAR 2 – 13)
Monitoring the change in price of specific mortgage rates
Included in this post are the following:
THE TRACKER 🔭
----------------
Most mortgages are sold into mortgage-backed securities (MBS) and the price of these bonds determines rates for all banks and lenders.
However, mortgage rates DO NOT rise or fall. Instead, the price of each rate changes while the rates available to you remain the same.
The Mortgage Rate Price Tracker (MRPT) illustrates this dynamic by showing how the price of each rate changed within the time series.
The higher the rate, the lower the fee (points). Some higher rates pay a rebate; this is illustrated on the tracker with negative (-) points.
When the “total change” is negative it means a reduction in the price of the rate.
The MRPT is a “rate and loan program” specific example of the LendZen Index, which monitors a much broader set of rates and mortgage bond coupons.
Both are effective for visualizing how the PRICE of mortgage rates has changed, while the LendZen Index is published daily at LendZen.substack.com
WEEK 2 📉
---------
Since the LendZen Index has a variety of time series, the MRPT will focus on just the current month’s activity.
Attached are the results for March Week 2.
You can also explore the results for weeks prior on this previous Substack post.
OBSERVATION:
The speed and ferocity of the current MBS sell-off has caught most off guard. Locking now feels a bit like closing the barn door after the horses are gone, but the economic calendar this week is unlikely to do anything to counter the oil price inflation that’s driving the bond sell-off.
RATE RECAP ⏪
--------------
Total carnage in MBS the last two weeks, with some MBS coupons falling in price by more than 200-bps.
The bond sell-off pushed the price of mortgage rates up 210+ bps for the lower end note rates.
This means an increase of $2,100 per $100k of loan amount, or $10,500 on a $500k loan … ouch!
Not all is lost; there are still low 6% rates available at “no cost” – where all transaction related fees are paid with lender rebate.
This week’s economic calendar also has pain written all over it.
Read more in yesterday’s Week Ahead Substack post.
Meanwhile, oil futures continued to climb over the weekend, temporarily crossing $100 per barrel, and flirting with it again in the early morning trading hours.
The LendZen LOCK-O-METER rate lock guide provides borrowers with a risk-weighted score based on how various macroeconomic events, including market data, central bank announcements, and geopolitics, each historically impacts the price of bonds.
Read the detailed lock recommendations for each score on this Substack post.
Meanwhile, check out this popular post explaining how to find the best deal when shopping for a mortgage.
Thanks for reading.
If you want to shop real-time mortgage rates and get instant qualification results without providing any contact information visit LendZen.com
LendZen provides a fully automated mortgage shopping experience that gives you anonymous access to all mortgage rates with full transparency of costs upfront as bond prices change.
You can also request an official Loan Estimate for the exact loan you created and save your scenario to revisit your rate options daily with one-click.
See for yourself and experience hassle-free mortgage shopping at LendZen.com
DISCLOSURES
LendZen Inc. is an equal opportunity mortgage lender, NMLS 375788.
