Bouncing Mortgage Rates

Mortgage rates have been bouncing all over the place.  There has been more and more volitility these past few weeks.  One day you’ll find a lender offering phenomenal rates only to find that same lender offering uncompetitive rates the next day.  Wachovia offered a 30 year fixed rate conforming loan at around 4.50% that seemed to vanish into thin air after a few hours.  Bank of America was offering jumbo loans that were about 1% less than its competitors, which were gone shortly thereafter. 

We’re not sure what to make of all this.  Is it gimmick pricing?   Have banks lost control of pricing?  Do they no longer have confidence in pricing loans?  Is Fannie Mae the cause?  The volatility in loan pricing seems to be much greater than can be accounted for in the movement of Treasury Rates.  If you have any ideas, weigh in with your comments.

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