Mortgage rates today do not appear to have been affected by the results of the election in France. Had conservative Marine Le Pen won, concerns about her policies, and possible destabilization of the European economy could have sent mortgage rates into bargain-basement levels.
However, this did not happen; Ms Le Pen lost handily to Â Emmanuel Macron, and economic boats have not been rocked.Click to see today's rates (Jul 24th, 2017)
(As of 11:30 PDT)
There are no economic releases scheduled today. So far there has been little movement. All three major stock indexes are down, which is normally good for rates.
However, yields for ten-year Treasuries are up two basis points (2/100th of one percent). Long-term mortgage rates often move Â the same direction as Treasury yields.
Oil is up (could be bad for rates because increasing energy prices cause investors to worry about inflation.) However, prices are well below $50 a barrel, so oil prices are probably not in play today.
Gold, on the other hand, is up -- which normally happens when the economy is uncertain. Increasing gold prices often go hand-in-hand with lower interest rates. CNNMoney's Fear & Greed Index remains solidly in neutral.
What we have is a mixed bag of factors that seem to be offsetting each other -- rates have changed very little so far.
Tomorrow should be another quiet day on the mortgage front. There are no economic reports expected, and no Treasury auctions either. Here is how the rest Â the week will look:
Until Friday, this is a pretty light week, data-wise. if I have a rate I like, I'd be tempted to set it and forget it. But if you want to gamble on Friday's releases, you may do better. I'd look at Wednesday and Thursday Treasury auction results and see how prices went before deciding. Good auctions mean lower rates; bad auctions (no demand) mean higher rates.
Mortgage interest rates depend on a great deal on the expectations of investors. Good economic news tends to be bad for interest rates, because an active economy raises concerns about inflation. Inflation causes fixed-income investments like bonds to lose value, and that causes their yields (another way of saying interest rates) to increase.
For example, suppose that two years ago, you bought a $1,000 bond payingÂ five percent interest ($50) each year. (This is called its â€ścoupon rate.") Thatâ€™s a pretty good rate today, so lots of investors want to buy it from you. You sell your $1,000 bond for $1,200.
The buyer gets the same $50 a year in interest that you were getting. However, because he paid more for the bond, his interest rate is not five percent.
TheÂ buyer gets an interest rate, or yield, of only 4.2 percent. And thatâ€™s why, when demand for bonds increases and bond prices go up, interest rates go down.
However, when the economy heats up, the potential for inflation makes bonds less appealing. With fewer people wanting to buy bonds, their prices decrease, and then interest rates go up.
Imagine that you have your $1,000 bond, but you can't sell it for $1,000, because unemployment has dropped and stock prices are soaring. You end up gettingÂ $700. The buyer gets the same $50 a year in interest, but the yield looks like this:
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2017 Conforming, FHA, & VA Loan Limits
Mortgage loan limits for every U.S. county, as published by Fannie Mae & Freddie Mac, the Federal Housing Administration (FHA), and the Department of Veterans Affairs (VA)