If you’re considering purchasing a home, you should make sure you’re watching mortgage rates. Why? Mortgage rates are a complicated beast. They are affected by many other factors that potential homeowners need to consider including mortgage costs and mortgage points paid into an account. These are linked to the APR (the annual percentage rate that measures mortgage costs). Knowledge of the APR enables purchasers to compare different loans offered by different lenders. How? Lenders who offer a low rate are more likely to charge high APRs in addition to fees.
The fact that mortgage rates are in a constant state of change cannot be overstated and should not be underestimated. Mortgage rates change almost as often as the stock market—thus, just as bonds and stocks rise and fall every day, so do mortgage rates. As a result, lenders make changes in their fees often.
What Changes Mortgage Rates?
The mortgage rate is affected by MBS- mortgage backed securities, which is a type of Wall Street security. These rates can be erratic as they change in line with the economy (and the economy is affected by outside influences such as the Eurozone, China, and the the evermorphing nature of international politics). In this way, rates are affected by every shift made in our market.
How Can I Keep Up With The Changing Rates?
Stay alert. Keep up with the financial news and make comparisons. Keep an eye on the Federal Housing Agency. And if all of this searching for information is too time consuming and confusing, take the pressure off. Consult an expert who can provide important and essential advice on mortgage rates.