Mortgage rates
Today I signed a bunch of paperwork related to mortgages and talked with my lender about how mortgage rates are determined. As with just about everything that any professional field does, there really isn’t that much magic behind getting an approximate sense of how this works. Apparently if you want to know whether you can probably get a 1/8th % better rate on a 30-year fixed mortgage, you should watch the 10 year treasury note. Fixed rate mortgages tend to follow fluctuations in this. I’m guessing the magic threshold varies, but right now I’ve been told that if you witness a 0.070 change in price of this note then mortgage rates might follow suit (up or down, with the note). USNews has more on this. Obviously the tnote doesn’t strictly determine the mortgage rate, but if you look at tnote pricing going back to the 80’s when mortgage rates were 2-3 times higher than they are today, it’s interesting to see that this was also about 3-4 times higher then than it is now.
rolando said,
August 14, 2008 @ 11:45 am
What the hell is this? Mortgage rates? Treasury notes? Speak English, nerd! Why aren’t you writing about running? My water bottle has a pocket for condoms. Is your sister still unreasonable?
Patrick said,
August 14, 2008 @ 11:55 am
exactly
rolando said,
August 14, 2008 @ 1:02 pm
if that’s the offending line…perhaps we should remind everybody that the condom joke originally came from YOU. i thought it was so wonderful i co-opted it without permission.
pwnd
Patrick said,
August 14, 2008 @ 1:28 pm
I’m not so sure about that. Anyway - I want the 10 year bond to go below 3.8770. If it does, then it’s crossed the magic threshold where I might save some money!
rolando said,
August 14, 2008 @ 1:44 pm
yeah yeah shutup…i can distinctly retell the story.
(ahem)
you stumble into SJ&J some sat morning–probably tripped on the way through the door on something. your hair’s a total mess. i try not to make eye contact but you immediately spot me and unathletically walk over. forced now to speak with you, i notice a stupid little pocket on your running shirt’s sleeve and commence making fun of it. “what’s this stupid thing?” I ask while poking at your shirt and openly mocking you and your wardrobe.
“it’s for my condoms,” you deftly reply.
“well played,” i internally think to myself, making sure not to say it out loud.
the end.
Patrick said,
August 14, 2008 @ 1:49 pm
So you’re saying there were no witnesses to this, huh? how’s that for dumb luck!
rolando said,
August 15, 2008 @ 5:49 am
oh there was a witness…unfortunately i’m not positive he knows how to use a computer.