· Inflation
Inflation is an essential factor in the overall economy and critical for mortgage lenders. Inflation erodes the purchasing power of dollars over time.
· Economic growth
Economic indicators, gross domestic product (GDP) and employment rates influence mortgage rates. When the GDP is up incomes are higher and consumer spending is higher. When income and consumer spending is up, the demand for mortgage loans also goes up. The increased demand causes mortgage rates to go higher. Naturally, the opposite effect occurs from a weak economy.
· Federal Reserve Monetary Policy
The Federal Reserve monetary policy is one of the most important factors that affect both the economy and interest rates. The Fed does not set the mortgage rates but their adjustments, up or down, have a significant impact on the overall rates available to the buying public.
· Bond Market
Bonds affect the mortgage rates because they compete for the same type of investors. When Treasury returns rise, banks charge higher interest rates for mortgages.
· Housing Market
When fewer homes are being built, the reduction in home purchasing leads to a reduction in demand for mortgages and send interest rates down.

Mortgage Broker
A mortgage broker works with clients to find the best lender that matches the goals of the client. The broker works on behalf of the client with several banks to find lenders with competitive interest rates that fit an individual borrower’s needs. Mortgage Brokers have developed stable relationships with top lenders which can provide peace-of-mind.

Brokers are licensed and regulated financial professionals. They handle the whole mortgage process, from securing documents to pulling credit histories, verifying income and employment. This information is used to apply for loans with several lenders in a short time frame.

Correspondent Lender
A correspondent lender is a lender that funds loans in its own name but sell the loan to a direct lender, which then services the loan. Correspondent lenders act as extensions for larger institutions and can sell loans to secondary markets.

Direct Lender
A direct lender is a financial institution that offers mortgages. Most are banks or savings and loan associations.