Following Moody's downgrade of the U.S. credit rating, mortgage rates have surged, exceeding 7% after remaining relatively steady for several weeks. The downgrade, which reflects concerns about the nation's fiscal health, has rippled through financial markets, particularly impacting the bond market. Mortgage rates are closely tied to the yield on 10-year Treasury bonds, which typically rise when the credit rating of the U.S. is lowered.
This increase in mortgage rates will likely affect potential homebuyers, increasing the cost of borrowing and potentially cooling down the housing market. Experts suggest that this volatility may continue in the coming weeks as the market adjusts to the change in credit rating. Homebuyers should carefully consider their options and consult with financial advisors to navigate the current economic climate.
Mortgage Rates Jump Above 7% After US Credit Rating Downgrade
Mortgage rates climbed above 7% this week, reversing a period of relative stability. The increase follows Moody's recent decision to lower the U.S. credit rating. This downgrade has impacted the bond market, which directly influences mortgage rates. Homebuyers will likely face higher borrowing costs as a result of these changes.
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