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I am currently renting and although it is cheaper it isn't home. The furnace drinks oil like a construction worker in 100 degree heat.
It was the ONLY house available to rent in the town we wish to live in. We will be building a passive and active solar home in town and thankfully our rental is only temporary.
When you rent, unless the inventory is high, you are at the mercy of the landlord.
In the Northeast price declines in most areas were not as dramatic as many parts of the nation. In fact, in many more desirable communities in central/north central Connecticut the inventory for decent properties is low and some prices are at or above what they were in 2007.
If you wait for the bottom with your family you may miss the opportunity to enjoy your home with your children for the prime part of your lives together.
I'm just trying to clarify incase other people are reading... I'm not sure which downturn you're talking about, but the 30 yr fixed mtg has been derived off of the 10yr bond since the 1990's. Also, the rates really don't come from the mortgage backed securities market. It starts at the bond market and then normally a premium is added to the bond rate to entice someone to take on additional risk to purchase an mbs instead of a bond. This creates the yield (interest rate) of the mbs. The lender can then convert their loans into mbs securities. But, the lender has a second option, they can sell the loans outright to a financial institution that keeps whole loans in their portfolio. In this case, the financial institution usually prices the loans directly off of the bond market.
you would have to show me any documentation that shows where the 10 year determines mortgage rates and is the%2
Last edited by mathjak107; 11-28-2009 at 09:56 AM..
you would have to show me any documentation that shows where the 10 year determines mortgage rates and is the%2
that reply got glitched.
you would have to show me some thing that shows that the 30 year fixed is based on the 10 year bond. i can show you endless documentaion that says its not .. its based on mbs..
in fact last jan the 10 year was at 2.39 or so. now its low 3's so that right there says with mortgage rates making new lows that it cant be linked to the 10 year which was almost 1% lower in january
We determined the pricing every day for years, so hopefully I have a clue as to how it's done... you're just reading documentation, but aren't seeing the behind the scenes calculations and pricing....
well show me one site that says that it uses a 10 year rate to determine the fixed 30 year. i cant find not 1... it makes no sense ... the fed is manipulating the MBS not the 10 year..
the 10 year is up over 1% higher than january so obviously its not being used. it was in the 2's now they are in the 3's
now i have read that the MBS tend to travel almost in lockstep with the 10 year under normal times because most mortgages are refinanced or paid off in 5-7 years so they 30 year tends to run a little higher the the 10 year since mbs tend to trade higher then a treasury since they are not.
sooooooo please enlighten me if what i believe to be true isnt but i see it specifically mentioned on many sites that it does not track treasuries.
The article you mentioned is too general. It doesn't even mention portfolio lenders or lenders who sell to other institutions who hold the loans in their portfolio. This lender in the article does have their loans pooled into a mbs, but not every 30 yr loan is not pooled into mbs securities. Plus, the article doesn't provide the calculations for determining the mbs price and doesn't mention anything about servicing fees, guarantee fees, etc.... The article is good for giving people an understanding of the market in general, but doesn't provide all of the details.
The article you mentioned is too general. It doesn't even mention portfolio lenders or lenders who sell to other institutions who hold the loans in their portfolio. This lender in the article does have their loans pooled into a mbs, but not every 30 yr loan is not pooled into mbs securities. Plus, the article doesn't provide the calculations for determining the mbs price and doesn't mention anything about servicing fees, guarantee fees, etc.... The article is good for giving people an understanding of the market in general, but doesn't provide all of the details.
.... it makes no sense to me when the 10 year is up big time from january and mortgages are the lowest ever. it cant be using it as an index in my opinion.... the mbs are the bulk of the index.. yes there are other sources, investor pools of money , banks loaning each other etc.. however all intermediate and long term treasury rates have soared this past year. the 30 year bond is up a whopping 70% in interest , the 10 year over a point.... the mbs are being bought by the trillions by the fed and thats whats being manipulated. .
2 weeks ago the fed had to buy a trillion dollars in mortgage back securities and that in itself brought mortgage rates to historical lows even while the 10 year rose ..... what do you think the biggest factor in mortgage rates is....
now thats not to say anything at some time cant be used as an index and im sure when the link allows it the 10 year is an accurate indicator for computing rates but the fact is that link is obviously broken right now and the MBS is running the show.
under normal times the 10 year is a good proxy for where rates should be .. actually if i can find it its spooky how closely until recently actual mortgage rates with all the fees and pofits track the 30 year bond..
the 10 year movement would still have to have a certain percentage added to it before its actually a mortgage rate.
some company did an overlay which places the 30 year bond over the actual mortgage rates and the actual rate you paid were closer to the 30 year bond.
to me thats the scarey part. that 30 year rate is up 70% over last year...
if that overlay is accurate which it seems to be historically then mortgage rates are like a time bomb waiting to explode once the fed stops messing with the Mortgage back securities markets.
Last edited by mathjak107; 11-29-2009 at 02:55 AM..
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