Not to explain that you have to understand that most banks, when they give a mortgage to somebody, they'll take that paper and sell it to one of the government sponsored entities.

Fanny Mail, Freddie Mac.

Are those groups within?

Package the mortgages together and sell them on to the secondary markets?

And it is the secondary markets that set mortgage rates.

How do they do that?

Well, they think you look very closely at the 10 year Treasury bond.

A look of the bond markets.

They will always have a spread. 00:00:58.500 --> 00:01:1.720 Mortgage rates will always be higher than the yield on the 10 year Treasury. 00:01:1.760 --> 00:01:9.670 Why, if they weren't Norman investing mortgages when you could invest in bonds instead, but they relate very, very closely to each other.

So to understand mortgages, you really need to look at the bond market.

When do bond rates go up when the yields increase?

Attend to increase.

Minton economy is doing better, because at that point in time, he will tend to invest more in stocks they do in bonds.

Additionally, you start seeing inflation coming into play.

You tend to find rates going up at that point in time as well.

And finally, when the overseas markets are doing well, that's when you tend to see those rates rise.

Where do we stand today?

There's still a substantial amount of investment in bonds generally because of geopolitical issues overseas people moving money to the relative safety of the United States bond market.

How do I see it going forward?

I think that the yields are gonna remain fairly static through the course of most of this year. 00:01:57.500 --> 00:02:0.950 Mortgage rates are grant arrives, but increase is going to be modest. 00:02:1.560 --> 00:02:13.790 I certainly don't expect the end of the year 30 year fixed rate mortgages being much about 4.2 to 4.3% that is certainly higher than the historic closely saw back earlier on this year.

But the trend is still such that I don't expect mortgage rates to God by much, at least for the next couple of years.