Zeev's Turnips Patch-No Politics (ZEEV)

[Newly2b]

Yes, the "long bond" is used to set fixed mortgage interest rates. Adjustable mortgage interest rates are tied to any one of a number of indexes: COFI (Cost of Funds Index), T-Bills, etc.

When considering an ARM, be sure you know what index it is tied to because a slower moving index (such as COFI) means smaller adjustments to your rate in future, whereas a volatile index (such as T-Bills) means more extreme adjustments to your rate. Also be sure to check the margin (the amount added to the index figure to determine your interest rate; this is set at the time the loan is taken, and does not change).

Newly