Mortgage Rate Price Tracker 🏠📉🔍 (NOV 3 – 14)
Monitoring the change in price of specific mortgage rates
THE TRACKER 🔭
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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.
This change is driven by mortgage bonds, not the lender, who will then add their own fees on top.
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 more “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 📉
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Since the LendZen Index has a variety of time series, the MRPT will focus on just the current month’s activity.
Attached is Week 2 of November – you can explore the results from Week 1 on this Substack post.
RATE RECAP ⏪
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The 2nd week of November saw a continuation of the weakness that has plagued mortgage bonds since late October.
You can revisit the MRPT results of October Week 4 at this Substack post.
Since the increase in mortgage rate prices began around October 28, long before the end to a government shutdown was on the horizon, the latest Fed rate cuts and recent econ data deserve more credit for the bond sell-off as both fueled the inflation narrative.
VA mortgage rates took the most damage this week, while the 15-Year out-performed the others, yet none were spared.
UP NEXT 🗓️
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With the government shutdown now over, economic data releases can get back to their regularly scheduled programming.
Although next week would normally be absent of heavy-hitters, the long-overdue September NFP jobs report (delayed since October 3) will be published Thursday, November 20.
The non-farm payroll data could be coming at the perfect time for mortgages rates, with the recent bout of bond weakness retracing back to where the last NFP rally paused.
However, an unfavorable report, even one that shows weakness in the labor market but is better than expected, could start to unwind the move in August that first ignited a wave of refinance and purchase applications in Q4.
More insight into next week’s events, along with the latest Rate Impact Calendar, will be posted in Sunday’s Week Ahead.
The latest Lock-O-Meter risk scores and detailed rate lock recommendations with be posted Monday in the Monday Data Deluge.
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.
DISCLOSURES
LendZen Inc. is an equal opportunity mortgage lender, NMLS 375788.
