Friday, June 12, 2009

How to Predict 30-Year Fixed Mortgage Rates

10 Year T-Bill vs 30 Yr Fixed RateClick on graph for larger image

The financial wizards at The Calculated Risk and Political Calculations have created an algorithm for calculating 30-year fixed mortgage interest rates based on the 10-Year Treasury Bill rate. The correlation is strong.

So you don’t have to dust off your calculus textbook, Political Calculations has provided a cool widget which is better than an 8-Ball for forecasting future interest rate trends.

In broad strokes, a rise in 10-year Treasury Bill rates portends increases in the 30-year mortgage rate.

A Weekly Survey of mortgage rates is published by Freddie Mac.

Historical data on the 10 Year-Treasury Note.