Week 1: Why Mortgage Rates Rise and Fall — The Economic Forces Behind Your Loan Cost
Mortgage interest rates often seem unpredictable, but they’re closely tied to what’s happening in the economy. Whether you’re buying your first home or refinancing, understanding what drives rates can help you time your move more wisely.
The Big Picture:
- Inflation: When inflation rises, mortgage rates tend to follow because lenders want to maintain the value of their returns over time.
- The Federal Reserve: While the Fed doesn’t directly set mortgage rates, its interest rate decisions ripple through the lending market.
- Bond Markets: Mortgage rates track closely with the 10-year Treasury yield, which is influenced by investor confidence and economic forecasts.
- Global Events: Wars, pandemics, and recessions can create uncertainty, causing rates to drop as investors seek safer assets.
Why it matters: A small shift in rates can add or save thousands over the life of your loan. Being informed gives you leverage—especially when choosing when (and how) to make your move.
At Seeking Agents™, we help buyers and sellers connect with motivated agents who understand how rates affect your buying power—and how to strategize around it.
Pro Tip: Don’t just watch rates—watch your timing. A great agent can help you understand if a slightly higher rate now is better than more competition later.
Next Week: How Inflation Impacts What You’ll Pay for a Home
*Savings are not guaranteed and depend on market conditions and agent negotiations.
This article is for informational purposes only and does not constitute financial advice.
Always consult with a licensed real estate professional before making any real estate decisions.