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Mortgage rates touched their lowest levels in more than 6 weeks on Friday as investors braced for bad news in the banking sector. Such fears pull money out of the stock market and into bonds. Higher demand for bonds means lower rates, all other things being equal.
After a weekend without any new bank drama, investors were able to move back in the other direction. News about the sale of most of the Silicon Valley bank’s deposits and loans only added momentum.
Why care about mortgage rates? Mortgages are based on bonds, so if the broader bond market is losing ground, so are mortgage rates.
The average lender yield for the 30-year stable scenario was down to 6.5% on Friday, but is now back up.
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