Mortgage rates hit a high last seen in early June in this week's Bankrate.com survey. Marcie Geffner investigates why.
The 30-year fixed has gone up almost half a percentage point in five weeks. I don't think I've seen a complete and convincing explanation for why mortgage rates have risen so quickly.
Geffner mentions the Fed's quantitative easing, concerns about eurozone debt, and some promising data about employment. Freddie Mac economist Frank Nothaft says today: "After Europe made strides in its debt situation, investors left the security of U.S. Treasury debt, causing bond yields to rise and mortgage rates along with them."
Those explanations don't sound sufficient to explain the full scale of what's happened. I have a hunch that bond markets overreacted, and that rates will come down a bit in the next days and weeks. My view is firmly in the minority in this week's Rate Trend Index, in which 80 percent of respondents said they believe mortgage rates will rise over the next week.