Mortgage Rates Supply and Demand
Can 11th Grade Economics 101 predict mortgage rate trends… you bet!
I learned in high school about Supply and Demand. When Demand is high the price will follow, and likewise when demand is low. When Supply is high prices drop and right now there is a huge supply of mortgages being written. When lenders make new mortgages they have to sell more mortgage bonds and right now lenders have an abundance of new loans from January.
What does our high school economics class teach us… if there is a huge supply of these mortgage bonds that need to be sold right now then price must go down. If mortgage bond prices fall then rates go up. Right now rates are on the rise and even though “Demand” is gotten them low and will keep them relatively low for a while, “Supply” is pushing them a little higher at the moment.
Where are rates today?
For a $250,000 loan I could offer 5.125% with an APR of 5.2576% on a Conventional 30 Year Fixed. This would assume a purchase or refinance at 80% loan to value, credit score of 740 or better and a primary residence. The origination fee would be 1.00% with no points.
There are many factors that go into a mortgage quote. If you would like more information about getting a mortgage loan in Tega Cay or Charlotte please call Olan Carder at 980-721-7478. You can also apply online by visiting my website at www.charlottemortgageonline.com.
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