Mortgage rates continue to run into a floor at sub 5.0%. This has held true for the month of January and just into February. The big picture outlook, barring a major shift in market sentiment that drives benchmark Treasury yields lower, is that mortgage rates should move higher in months to come. While in any given day can result in small reductions in borrowing costs, the risk of rates rising is almost a guarantee. The longer term projection is if you are looking to hedge your bets for a lower rate than what you can secure today then keep an eye on the stock market.
If stocks extend recent weaknesses then you could capture the momentary drop and pick up that extra .125% savings in your interest rate. To do this you must have already have your credit package prepared with your broker and have a bit of luck. The reality though is just like in the stock market…few people truly buy a stock at its lowest cost and sell at the highest price. That said, take advantage of mortgage markets lowest levels in recent history.
For everyone that is looking to purchase a home or refinance their current home, expect a rise in mortgage rates over the next few months as the Fed exits the Mortgage Backed Securities (MBS) buying program. This is in line with recent guidance issued on Mortgage News Daily.
Don’t wait for mortgage rates to decline! 4.75 to 5.0% rates could very well be the lowest mortgage rates offered in 2010…unless there is a fundamental shift in economic horizon. If you have been waiting to refinance or to buy, get out there and start the process before you miss the boat of 5% rates
Contact Desmond Elder with Pacific Mortgage Consultants for current financing rates and to help you determine your best options.
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