Mortgage rates are rising again ? and that?s bad news for homebuyers and refinancers. With the most recent figures indicating a big decline in mortgage applications, the conditions are ready for MBS ETFs to pick up steam as yields increase and prepayment risks get diminished. MBS ETFs are invested in mortgage-backed securities, which are home loan-backed debt securities.
Mortgage rates have experienced a notable decline as the spring home-buying season begins, according to the latest data from Freddie Mac. What To Know: The 30-year fixed-rate mortgage dropped to 6.63% as of Tuesday, down from 6.76% the previous week, marking the largest weekly decrease since mid-September 2024.
In the week ended Feb. 21, U.S. mortgage rates declined to their lowest levels this year, Bloomberg reported, presenting potential opportunities for investors in mortgage-backed securities ETFs.
Homebuyers received some good news this week: Mortgage rates declined for a fifth week to their lowest level since last year and the median U.S. home-sale price rose by the smallest increase since last September. What To Know: According to Freddie Mac, the average rate for 30-year loans was 6.85%, down from 6.87% last week, reaching the lowest level since December 2024.
Shares of Fannie Mae and Freddie Mac fell Monday after Keefe, Bruyette & Woods analysts downgraded the stocks to Underperform. What To Know: The Keefe, Bruyette & Woods analysts, led by Tommy McJoynt, said that though the odds of a privatization attempt have grown lately, they see "considerable risk" to the stocks at their current levels.
President-elect Donald Trump?announced plans Thursday to nominate private equity CEO Bill Pulte as director of the Federal Housing Finance Agency. What To Know: If Trump?s selection is confirmed, Pulte will become the top housing regulator, overseeing mortgage giants Fannie Mae and Freddie Mac , which have been in conservatorship since the 2008 financial crisis.
U.S. stock markets experienced a downturn today, with the?S&P 500?declining by 1.07%. The?NASDAQ?also saw a decrease, falling by almost 1.2%. The Dow Jones Industrial Average declined almost 1%. Despite these indices in the red, certain stocks captured significant attention from investors.
In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.
Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.
Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.
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