Mortgage Rates Hit Highest Levels In Months, More Volatility Ahead

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Posted To: Mortgage Rate Watch

Mortgage rates skyrocketed to their highest levels since August on Friday, both as a part of an ongoing move higher that began yesterday and more specifically in reaction to overnight events in Europe. Strong economic data in Germany sent interest rates initially higher overnight, but the bigger surge followed an ECB announcement detailing the 278 of 523 European banks that had already begun paying back 3-year loans made by the ECB in late 2011. MBS (the mortgage-backed securities that most directly influence rates) opened in much weaker territory and continued to sell-off throughout the day. When MBS "sell-off," prices are falling, meaning investors are paying less for mortgages. This causes closing costs, rates , or both to move higher. Depending on the lender and the particulars of the scenario...(read more)

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Source: http://www.mortgagenewsdaily.com/consumer_rates/293075.aspx

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