What’s Behind July’s Mortgage Rate Drop?

Mortgage Auction

?????????????????????????????????????????????????????????????????????????????????????????????Even though mortgage rates have been steadily climbing over the past few months, the very end of June and beginning of July saw a rate drop—the first one in months. While many prospective homebuyers are obviously pleased about this drop, others may be wondering why these rates fell seemingly out of nowhere.  There are a number of interesting factors that impact the ups and downs of mortgage rates, but one of these, surprisingly, is the Federal Reserve.

QE3 Mortgage Bond Program

 What many people may not know is that the Federal Reserve is the brains behind the QE3 mortgage bond program, a program that aims to relieve some of the pressure that was placed on the economy after the housing market crash in 2008. In a nutshell, the Federal Reserve opted to buy up a significant amount of market debt (to the tune of $40 billion) in order to…

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