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Mortgage Rates Wednesday, Aug. 23: Lower After Trump Speech

Aug. 23, 2017
Finding the Right Mortgage, Mortgage Rates, Mortgages
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Thirty-year fixed mortgage rates slid three basis points, to their lowest level since November, while the 15-year fixed fell by one basis point and 5/1 ARMs were unchanged, according to a NerdWallet survey of daily mortgage rates published by national lenders Wednesday morning.

Mortgage rates respond to bond markets, and bond traders are attuned to any hint of political disruption. President Trump dropped such a hint in a speech Tuesday in Arizona. He said it was “absolutely necessary” to build a border wall and added: “Now, the obstructionist Democrats would like us not to do it. But believe me, if we have to close down our government, we’re building that wall.”

The words “close down our government” impelled traders to buy bonds — not only Treasurys, but mortgage-backed securities, too. Both are considered among the safest investments because they are backed by the federal government. Even if there’s a shutdown, the federal government will eventually pay its bills.

When investors compete to buy mortgage-backed securities, they signal that more money is available for lending to home buyers — and when the supply of money goes up, the price goes down. In the case of mortgages, the price is the interest rate.

This is the lowest level for the 30-year fixed since Nov. 9 (the day after the presidential election), when it was 3.79%.


(Change from 8/22)
30-year fixed: 3.97% APR (-0.03)
15-year fixed: 3.43% APR (-0.01)
5/1 ARM: 3.89% APR (NC)

NerdWallet daily mortgage rates are an average of the published annual percentage rate with the lowest points for each loan term offered by a sampling of major national lenders. APR quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.

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