Why Mortgage Rates Diverged From Bond Rates And Headed Higher

[Keith C.]

Over the last few days Mortgage rates have been heading higher .When Bonds hit all time lows banks essentially threw in the towel after getting inundated with rate  Lock requests . They Pulled the plug on the lowest priced rates ever seen .

I was locking in loans under 3 % on Friday and  Monday but  by Tuesday the same loans were in the high 3%'s some banks were over 4%. Too many Borrowers overwhelmingly tried to lock in these low rates that bankers had to curb the mortgage submissions. 

 The quickest way was just raise the rates and end the party . Consider the fact that  more than likely  those who had already applied with a broker or bank and already  had their documents in a file were able to take advantage Of this very short lived rate bonus. 

As the loan application queue lightens  up we will likely see a the bond and mortgage markets realign. My suggestion if you are in the market for a new loan or a ReFi get your app in and wait for rates to come back down. You likely wont like today's rates as many are higher than a few months back  Best of luck and keep your eye on rates as they have been all over the place this past week