Industry NewsMortgage

Mortgage rates probing new lows

Banks have stepped up purchase of securities that fund loans
Published on May 10, 2012

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by CareyBot

Mortgage rates hit record lows for a second week in a row as investors -- including banks -- continue to see mortgage-backed securities that fund most mortgage loans as a hedge against economic uncertainty.

The Federal Reserve reports that banks are more reluctant to originate mortgages to borrowers with flawed credit than they were in 2006, but are nevertheless stepping up their purchases of loans that have been packaged into mortgage-backed securities guaranteed by Fannie Mae and Freddie Mac.

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