Why Raleigh Home Loan Rates Move Down and Up by Kevin Martini

Why do do Raleigh home loan rate move downward? Why do Raleigh home loan rate move upward?  In episode eleven of the Martini Mortgage Podcast, Kevin Martini with the Martini Mortgage Group at Benchmark Mortgage addresses the ‘WHY’ Raleigh home loan rates move down and up.

What drives Raleigh mortgage rates — what drives home loan rates on the aggregate?

As a primer, one needs to know that mortgage rates live in the Bond market.  The real driver of home loan rates are Mortgage Backed Securities (MBS).  A MBS is a type of Bond.   When there is good things happening or good economic news, generally speaking, Bond prices worsen and when this happen home loan rates increase.  When there is not so good news or there concerns then, generally speaking, Bond prices improve and this causes home loan rates to get better and this is because Bonds provides a a safe harbor for investments.

It is my opinion there are five main factors that drive Raleigh home loan rates and all home loan rates in the U.S. for that matter. 

Economic Data – MBS are the driver or home loan rates however the ups and don of the economy have a direct impact  on whether or not investors move money into Bonds in the short-term or not.  There are many economic indicators released every month but the 3 ‘Kevin Martini Must-watch Economic indicators’ are: Gross Domestic Product (GDP) Report, Inflation Reports (i.e. Core Personal Consumption Expenditures & Core Consumer Price IndexUnemployment – Non-farm Payroll Report


Inflation – Inflation is the nemesis to to a Bond since it erodes the purchasing poser of a Bond’s future cash flows.  Typically, as inflation increases, Bon prices tend to decline and this cause Raleigh mortgage rates to usually rise.



Stock Market – the Stock markets and interest rates have an inverse relationship, most of the time.  When an investor puts money into a Stock market that is doing well, money moves out of Bonds causing Bond Prices to drop & in turn pushing home loan rates higher. yahoo

The Federal Reserve – The Federal Open Market Committee (FOMC) is a 12 member committee made up of seven members of the Board of Governors and five Federal Reserve Bank Presidents.  They meet eight times per year in order to to determine the near-term direction monetary policy. 


Geo-Political Events – whenever Geo-Political events occur it will make the headlines. For example, if there is increased tension in one part of the World then investors may look for a less risky way to invest and that is typically Bonds.  This causes mortgage rates to go down.


When it comes to forecasting home loan rates the Martini Mortgage Group at Benchmark Mortgage cannot predict exactly where they will land however we monitor the markets by the minute to give the the best advice on whether to lock or float.  In addition, we provide trusted advice on which mortgage product that is right for your unique situation. 

Buying a home is a process not an event.  The process can and should be enjoyable and educational.  It is when you ‘Know Before You Owe’. To eliminate frustration the first step in your home buying process should be to get Pre-Approved for your mortgage.

Pre-Approval allows you to know your budget before you fall in love with a home that is way outside of your budget. When you are Pre-Approved you also will have clarity on the price and costs for your Raleigh mortgage so when you place an offer you can make it with confidence. 

‘The first step in your home buying process should be to get Pre-Approved for your mortgage.’  Kevin Martini

If you are currently in a starter or trade-up house that no longer fits your needs and you are looking to step into a luxury home, now is the time to list your house for sale and make your dreams come true.

If the right thing for you and your family is to purchase a home this year, buying sooner rather than later could lead to substantial savings.  Call the Martini Mortgage Group at Benchmark Mortgage so we can get together to evaluate your opportunities.

Kevin Martini | NMLS ID 143962 | Branch Manager | Martini Mortgage Group at Benchmark Mortgage | Ark-La-Tex Financial Services, LLC NMLS ID 2143 | 5650 Six Forks Road, Suite 101 Raleigh, NC 27609 | (919) 238-4934 | www.KevinMartini.com | kevin.Martini@Benchmark.us | Equal Housing Opportunity

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