Mortgage Interest Rate Trends [10to5mortgage.blogspot.com]
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10to5mortgage.blogspot.com Trends and Issues Affecting the Residential Mortgage Industry
Mortgage interest rates are ever changing due to the status of the economy. There are several other factors that effect interest rates related to mortgages. To understand what effects an interest rate is to understand why it is consistently fluctuating.Â
What effects a mortgage interest rate?Â
There are several factors can that influence a change in rate. First there are bonds. The general term bond in this case relates to mortgage backed securities. It is a simple formula in that when a bond sells for less, the interest rates will increase. When a bond sells for more, interest rates will then decrease. As we are currently in a state of flux with our economic status, rates are changing from week to week.Â
Why are mortgage interest rates continually unstable? Even due to changes in mortgage backed securities, emotions are truly the most swaying factor in interest rate determinations. Individuals who may read about stocks, employment/unemployment data, and economic information are effected by this news. Even hearing about a mass set of purchases within a certain state or county can influence others to consider the purchase of a home. People effect people. A trend, is just that, a trend. This is why interest rates can not only change from week to week, but also from day to day, and even hourly.
In this, supply and demand becomes an issue that also effects interest rates for mortgages. In a location such as Milwaukee, Wisconsin, where there are often several homes for sale on a consistent basis, there may not be as much of a demand for a home purchase as say in Sedona, Arizona.
Additional factors such as growth in GDP (gross domestic product), inflation and prices of oil can also make slight changes to interest rates affecting mortgages.Â
As of today, there has been a drop in interest rates. This has encouraged those looking to purchase a home to act quickly. It is also encouraging those who were looking to sell their home, to make pricing adjustments, and/or get their property on the market.Â
It is always in a buyer or seller’s best interest to be informed, but to also be prepared for interest rates to drop so they can make their move. By getting pre-approved for a home loan, one can then watch interest rate trends, and purchase when the time is right. Additionally, finding an informative realtor to aid in your purchase or sale can also prove to be a good decision. More Mortgage Interest Rate Trends Articles
Question by refi: current mortgage interest rate trends? I am considering refinancing now. But if I wait six months, I will have time to do some remodeling that will definitely bring up the value of my house. This would decrease my loan to value, hence no PMI payments....I however know nothing about the current mortgage trends. I can get a 30 yr fixed at 6.125% with a broker I am working with now. Am I risking too much to wait 6 mos to refi? I currently am in an interest only loan of 7.25% I only did it to get the house knowing I was going to refi in the future. So do I do it now or in 6 mos? I don't gain much, other than a more stable loan by refi now. Thank you Thank you Best answer for current mortgage interest rate trends?:
Answer by greffy
You may have picked the perfect time. The Feds dropped the rates today! If I were you I would not wait for another rate drop. I think they are going up, up ,up over the next few years. Curious about discount real estate agents? http://www.flatfeerealestateguide.com
Answer by crey r
fix up the home but when you refinance tell your friend you want 5.875 or better you could get it now if you needed. i would definately get the upgrades done asap and then refinance but dont wait till the last minute. and when you do refinance make sure you get he rate you want and try to get it under 6% its possible now and if things dont go up you should have no trouble getting it
Answer by Brand X
Nobody really knows where interest rates will be in 6 months. On the one hand, the rapid decline in the dollar versus other currencies makes imports more expensive (from China whose yuan cost 10% more now than last year) which leads to inflation (and thus higher interest rates). This implies that the fed will raise interest rates to prevent inflation. On the other hand, if the recent subprimal fear continues, then domestic demand might shrivel up putting our domestic production at risk...this implies that the fed will lower interest rates even more in order to keep us out of recession.
Answer by DJ B
You may want to refinance now just to get out of that interest only loan. Don't wait, each day put's you behind on the priniciple, thus taking away from your equity position.
Answer by Mike
No one knows where the interest rates will be in 6 months. The FED dropped the discount rate, but that wont effect 30yr fixed mortgages much. One thing is for sure... the value of homes in most of the country is going down.... so even after you remodel, you might be lucky to break even value-wise in 6 months.... so I would not bank on your house being worth more in 6 months. 6.125% is a very good rate right now... they have been hanging over 6.5% lately. I would jump on that.
Answer by realtynewsman
With an interest only loan in this market (which means your loan balance may be rising while your home value is falling) you are playing with fire. Home prices are falling and interest rates were trending up (as of 8/17/07). Depending on your market, the amount of your refinance, and a host of other factors, the work you do on your home could amount to a hill of beans in terms of added value. A mortgage market shake out stems from too many risky subprime and Alt-A loans written without regard to borrowers' ability to repay, a resultant rise in foreclosures from those unable to pay rate-reset increases in monthly payments and the negative impact of those foreclosures on investment funds that buy and repackage the loans as securities. With the securities failing as investment vehicles and some lenders shuttering shops and filing for bankruptcy, lenders have attempted to plug the financial drain, by tightening underwriting standards and by taking many loans off the menu. That means with each passing week you loan choices diminish. That 6.125 percent rate you speak of may no longer exist. In addition to lenders tightening money on subprime and Alt-A loans, they are also rising rates on jumbo loans (those of $ 417,000 and more), so they could get you coming and going. This is NOT a wait-and-see market.
Answer by Hendry
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