Mortgage Rates Rise, Stabilize in Wake of Fed Interventions
Amid a sea of uncertainty, the market began to show signs of stability over the past seven days as mortgage rates increased. While day-to-day changes in rates remain quite substantial by historic standards, the wild swings have calmed in recent weeks after a period of extreme fluctuations.
This suggests the historic intervention by the Federal Reserve has successfully eased some of the strains that had plagued the market just a few weeks ago, though challenges remain. Still, much like last week, looking solely at the market for conventional loans only tells part of the story. Limits to forbearance offerings, not to mention high degrees of uncertainty around the credit worthiness of some borrowers, continue to restrict market activity for non-agency and unconventional loans.
The outlook for the coming months remains very uncertain, so the appearance of a calmer market of late could be a mirage as the likelihood of a sharp move in financial markets is still quite high.
