Question

What has happened to mortgage rates since the Fed dropped interest rates to almost zero?

What has happened to mortgage rates since the Fed dropped interest rates to almost zero?

Homework Answers

Answer #1

The mortgage rate has fallen but not that sharp as interest rates even though it is expected to fall lower.

The mortgage rate, with the FED cutting Interest rates to zero and reinforcing quantitative easing including mortgage backed securities, are poised to go down and even hit new all time lows.

Fed rates cuts would not directly lower the mortgage rates and they mostly are long term securities and their movement is based upon long term TBills than short term TBills.

So In the near future , the mortgage rates are expected to hit Lower even though it has not fallen significantly as of now.

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