Watch Your 'Back-ing'

Wow! - Seriously the swings that we are seeing are the worst I have ever seen.

From last Friday, we are up over 1/2% on the 30 year fixed rate - approaching another high that hasn't been seen in the last 3 years.

The news out today is that there are rumors floating around that Mortgage Backed Securities may lose their AAA rating. Remember that the Federal Government provides Fannie Mae and Freddie Mac with full backing in order to reduce the risk to investors. But investors are requiring the highest premiums on Mortgage Backed Securities since 1983. This is why you see the Treasury markets (1-10 year Treasury notes) continuing to go up in price and down in rate, but Mortgages continue to get hammered on price - driving the rates up. OUCH!!!!