How to find a current mortgage rate

One must be proactive these days when shopping for mortgage loans. Studying up-to-the-minute Web sites and watching nightly financial broadcasts are some of the best ways to stay ahead of trends that can affect the current mortgage rate. Using online calculators, reading financial news blogs and articles keep you well informed, but just make sure you're getting the right info.

The federal funds rate is set by the Federal Reserve. But when the Fed cuts the federal funds rate, mortgage rates don't necessarily go down. This is because your mortgage -- fixed or variable -- is determined by mortgage-backed securities, or MBS, and like stocks and bonds, these are traded and sold. Investor demand for MBS causes price increases, and as is true with any other stock, if the yield decreases, we see lower rates.

As with everything else in our economy, investor demand for a product, or investors pulling away from a product, affects that product -- mortgages are no different. Trying to calculate the near future of a current mortgage rate is very much like trying to determine which stock to buy or when to sell what you're holding. And while government policies can affect mortgages, you need to know what to look for and the reasons you are looking, and this is what will give you an advantage when shopping the current mortgage rate for your loan.

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