Mortgage Rates Dip in Advance of Forecasted Rises in 2010
While the mortgage industry is definitely expecting a rise in interest rates in upcoming months, the first week of the year has actually seen a slight dip in rates as we enter the new decade. The mortgage rates for 30 year mortgages have actually managed to drop slightly from around 5.14% to 5.09% for the first dip in a steady climb over the previous five weeks after hitting an epic low of 4.71% at the beginning of December.
Most experts in the field of economics have been expecting a slow and steady rise in mortgage rates, due, in part, to the nearing the deadline for the Federal Reserve support for keeping the mortgage rates lowered artificially by buying up mortgage-backed securities at the end of March. To let the mortgage sector recover now, the industry needs to be weaned off Federal support and allowed to recover on its own. The Federal Reserve purchased over a trillion dollars worth of mortgage-backed securities to regulate the interest rates and try to encourage people across the nation to become home buyers.
Expert economists seem to agree that the interest rate on 30 year mortgages will likely rise by about 0.75% by mid-year 2010 and will continue the remainder of the year though the rising rates arent expected to change much until the Federal Reserve program expires in March.
Although mortgage rates arent expected to rise to the previous levels that we had seen in 2006at least not this yearit is still recommended that anyone considering a home purchase not linger too long over the stock on the market if theyre looking for the best deal on interest. While a 1% change in the mortgage interest rate is not likely to price you right out of a certain home, it will make a difference to your monthly mortgage payments.
All in all, with the upcoming changes in real estatewith the ending of the Federal Reserve program to keep interest rates low, the governments tax credit for home buyers, and the Making Home Affordable refinance programit is a good idea for home buyers and home owners needed to refinance to get on the bandwagon and get their ducks all in a row before these programs expire and theyre left out in the cold. It is expected that the market may just not be as full of good deals once these programs have all expired.About the Author:
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