Most volatile week in mortgage rate history (Market update – June 16, 2022)

Monday we had one of the biggest increase in mortgage rates. Top 5 worst days in mortgage rates that I have seen in my career and in recorded history!

Hey everybody it’s john king with summit funding here we are wrapping up the week of june 17th and man has it been an absolutely crazy week i gotta tell you this will probably go down as one of the most volatile weeks in mortgage rate history monday we had one of the biggest increases in mortgage rates top five worst days and mortgage rates that i’ve seen in my

Career and really in in recorded history we had a highly highly volatile week and it all started last friday with the inflation report so i want to walk you through what happened try and not get too in the weeds with the technical side of stuff but help you understand because it’s critical i’m going to wrap up with where are we headed what’s going to be happening this

Summer what’s going to be happening going through this year this is all about inflation if you watch my weekly videos last friday i talked about inflation and the fact that the markets that’s the stock market the bond market mortgages are a bond the markets have been uh thinking that inflation is going to be kind of under control the fed’s raising interest rates by

A half a percent in march another half a percent in may and maybe just maybe that’s been enough to keep inflation under control and then we end up getting the inflation report from may that came out last friday june 10th and bam inflation is significantly higher than anybody expected now why is that a big deal because inflation is what’s driving up mortgage rates

Because mortgage companies are receiving really the bond the investors and mortgages are receiving a set amount of money every single month for the next 30 years and if inflation is out of control then that set amount of money won’t go very far it doesn’t spend as much because it costs more for the value of buying anything like bread or gasoline or anything else

So fast forward to this week friday mortgage rates were were really in bad shape monday they were even worse because everybody’s afraid that hey the fed whose job it is to control inflation clearly has no idea what they’re doing now i’m being a little mean when i say that but the truth is that’s what the markets were reacting to is saying hey the fed does not have

This under control now what so monday was a bad day tuesday was a pretty bad day and then we fast forward to wednesday and the federal reserve does something they haven’t done in almost 30 years it’s been since 1994 that the fed raised interest rates by three quarters of a percent so they got a half percent in march a half percent in may and now three-quarters

Of a percent increase and everybody’s worried oh my gosh that means rates are going to go up on mortgages significantly not true the fed is acting like the fire hose putting out the fire of inflation that is currently burning rampants and everybody thought that that fire was under control so now the fed realizes that hey the fire is not under control they bring

Out the big guns they bring out the fire cannon of the fire hose it’s attached to the big fire truck and they start putting a lot of water on the fire it doesn’t mean the fire is out but it means that we can calm down a little bit because the fed has brought out the big guns they’re raising the short-term rates which is designed to slow down the economy and when

They slow down the economy inflation should slow down with it when inflation is under control and start slowing down mortgage rates will come back down that’s the key now we look at thursday so on thursday the 16th we have interest rates come out and they’re worse again basically we’re back to where we started on tuesday and we lost all of the benefit we got

On wednesday he said john what the heck is going on i thought you said that the markets were happy with the fact that the federal reserve had brought out the big fire hose but here’s the problem there’s fires all over the world and so we had news this morning from europe that they’re even more concerned about their inflation and there’s problems happening with

The economic issues in europe there’s problems happening all over the world and one economist talks about it as many many little fires think about a forest fire think about wildfires you have many many little fires all over each of them are a problem but if those fires come together and join as one big fire we have a major problem on our hands that’s essentially

What’s happening right now we’re gonna deal with significant volatility going forward we’re gonna deal with interest rates going really high and really low and really low we’re in the fives to sixes and i don’t think we’re getting out of that range i think there’s a chance we’re hitting the sevens to be honest are we gonna get back down to the fours at some point

We’ll probably get back down into threes but not until inflation is under control and once we have inflation under control we’re likely to hit a recession and that recession is going to drive down interest rates further and put us in a better position to be able to take advantage of low rates but do not misunderstand now is the best time to buy a house and i have

Multiple reasons why so check out my videos i’ve got them linked down below if you’re watching on my place i’ll get linked over here on the right side there’s lots of reasons why now is a great time to purchase a home make sure to check out those videos so you understand why you need to make the move today thanks guys we’ll talk to you soon

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Most volatile week in mortgage rate history (Market update – June 16, 2022) By johnLOANking