Mortgage Rates and The Election

Mortgage Rates & The Election

Mortgage Rates & The Election

Once every 4 years we see clients holding their breath and hitting pause to see how election day unfolds.  How does Nov 8th actually impact mortgage rate trajectory?

We hear hip shooter predictions like “in election years rates go up…” or “in election years rates go down.”   The election itself has zero impact on rates.   It is the president elect and their agenda that may have an impact on mortgage rates.   Also, the relationship between the president elect’s agenda and the current administration’s policies can impact what happens to mortgage rates post-election day.

This also becomes a game of what the “market” thinks about the president elect related to mortgage rates.  It’s not necessarily what you or I think.  So once you make your mind up on which president is good for rates and which is not, etch-e-sketch it and then take a guess what the market will think.  That’s what matters.

What Will Happen with Mortgage Rates (we think)

Here are our predictions:


  1. Probably Lower Mortgage Rates
  2. Candidate that causes uncertainty for the economy
  3. Candidate that promises lots of monetary policy and regulatory change


  1. Probably Status Quo for Mortgage Rates
  2. Candidate that creates stability for the economy
  3. Candidate that promises little monetary policy and regulatory change

Why do the above ideas matter?  First, they matter most in the short term – meaning right after the election.  Longer term it will be more about what the new president actually does and says.  However, markets tend to embrace for “possibility” rather than wait for “reality” in the immediate.

If the market sees that the president elect falls into category A above, mortgage rates would likely improve primarily on a “flight to quality basis.”  Simply put, sell off stocks and stuff money in safe/sound and secure bonds.  Bonds do not pay well.  However, anything pays better than a plummeting stock.  Funds shifting from stocks to bonds leave mortgage rates lower.  That is essentially why mortgage rates would likely improve under category A.

Category B is easy.  If the market sees little change, there is less “possibility” for markets to react to.  Less fear and worry.  Therefore not quite the need to sell off stocks and as a result much less movement in mortgage rates.

The answer will be revealed Wednesday!


By Jeremy House

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Jeremy is the Founder of The HOUSE Team and a Sr. Loan Officer/Branch Manager with PrimeLending. Over the past several years he has ranked in the top 1% of all loan officers nationwide and one of the top 200 loan officers in America. In the mortgage industry, the devil is in the details. Jeremy prides himself on being a student and an expert when it comes to everything mortgage related.

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