Lansing, MI Mortgage

Why Do Mortgage Rates Have to Rise?

Mortgage Rates – Why Do They Have to Rise?

Well they don’t have to. We cannot know the future. New and unknowable information creates the future for us, and even though we are told that certain things are going to happen, we don’t know for sure that they will until they do.

Let me give you an example…

Fed Will Keep Buying If Rates Spike

As we have been saying since this time last year – the FED will officially end its Mortgage Backed Securities purchase program in March this year after it reaches the prescribed $1.25 Trillion mark.

But, according to New York Fed Bank President William Dudley, the Fed is not on “auto pilot” and will restart the MBS purchasing program if mortgage rates spike. “If there is a sharp turn in the road” Mr Dudley said, the Fed would intervene…

Why Interest Rates Will Likely Begin to Rise

How are Interest Rates Determined?

Interest rates are the result of the yield on Mortgage Backed Securities (MBS). When MBS are sold to investors they are purchased at varying levels of demand. If they are in low demand, the price of the security will go down and the yield (or return) will go up. This will result in higher rates to the consumer…