Fannie Mae-No Politics (FNMA)

[Robert from yahoo bd]

The 30 year Fixed Rate Mortgage's interest rate is set by the yield on the 10 year Treasury plus a spread above that (imbedded in that spread is a Guarantee Fee of about 60 basis points), this is a good quick article from 2 good looking chicks to explain it better than me (ahhh, beauty AND brains, what's not to like?):

https://www.brookings.edu/articles/high-mortgage-rates-are-probably-here-for-a-while/#:~:text=indicate%20recession%20periods.-,The%20spread%20between%2030%2Dyear%20fixed%20mortgage%20rates%20and%2010,2023%2C%20and%20has%20remained%20high.

"Mortgage rates reflect the cost of using a mortgage to buy a home or tap home equity and thus affect the price of real estate and housing wealth. To the degree that the Federal Reserve’s tightening of monetary policy pushes up mortgage rates, this channel is an important way in which tighter monetary policy slows the economy and dampens inflation. As shown in figure 1, there has been a long downward trend in mortgage rates (dark green) over the past 40 years in line with the rate of 10-year Treasury bonds (light green). However, the spread between mortgage rates and Treasury bond rates fluctuates for various reasons, including changes in credit conditions and interest rate uncertainty."