Mortgage Rates are flat to slightly higher this week.  We need to be cautious of the markets going forward after Wednesday Fed minutes showed some officials want to talk about “mortgage bond tapering” at the next Fed Meeting.

What is mortgage bond tapering?  Let’s quickly recap: Mortgage Rates are driven 100%/solely on the price of MBS (mortgage backed securities).  When bond prices go up, rates come down (their relationship is inverse) and visa versa.  Since the pandemic in late March of 2020, the Fed’s have been purchasing over $40 BILLION in MBS each month so they artificially drove UP MBS and artificially drove DOWN rates to support the housing market, and what they are now saying is this will soon start talking about unwinding this policy.  When this happens (historically speaking) bond traders start to liquid their holdings (taper tantrum) since they do not know the “true market value of the security”, which create pre-tapering selling pressure leading up to the Fed Announcement.

Bottom Line: My advice is to purchase a home or refinance your existing home sooner vs. later with rates still sitting just above record lows.


Keith Murphy Branch Manager – Essex Mortgage NMLS #330827

Direct: 714-309-1140


About the Author

Tim Morissette, also known in the community as Mr. Foothill Ranch, offers over 46 years of real estate experience which has given him an established reputation and unmatched market knowledge. He is joined by his wife, Michele and sons Matt and Jeff, as they continue to offer personal service with an emphasis on achieving his clients’ real estate goals.  This unique combination of traits has led to his proven track record of referral and repeat business. This can be witnessed by the trust of homeowners in Foothill Ranch where he has sold twice as many homes and represented three times more buyers than the next-leading real estate agent for the last 26 years.

As residents of Foothill Ranch since 1994, Tim and Michele are actively involved in the community by fundraising for Foothill Ranch Library, Make-a-Wish Foundation, Cancer Society, Homes for Habitat, Relay for Life, South County Outreach, and the local church and schools. Tim enjoys sponsoring community-wide garage sales, paper shredding and e-waste recycling event, an Easter egg hunt, & a Meet Santa Event.

Tim and Michele are dedicated to their family of four sons, daughter-in-laws, and grandchildren. As a family, they enjoy many outdoor activities which include camping, spearfishing, mountain climbing and exploring the miles of hiking and equestrian trails in Foothill Ranch and the Whiting Ranch Wilderness Park. Tim and his sons are also avid snowboarders and enjoy mountain biking and lobster diving. Family is a top priority in the Morissette household. They look forward to helping more families achieve their dreams of homeownership.