Mortgage Rate Trend Index
Will rates rise or remain relatively unchanged? Experts and Bankrate analysts provide their insights.
This week (April 23 - April 29) the experts say: Steady as she goes -- mortgage rates will probably stay where they are. This week, 19 percent of the panelists believe mortgage rates will rise over the next 35 to 45 days. Another 31 percent think rates will fall, and the rest believe rates will remain relatively unchanged (plus or minus 2 basis points).
Industry experts and Bankrate commentary
Better late than never that the National Association of Realtors is voicing its opposition to the "dumber than dirt" gatekeeper fee that will enrich appraisal management companies at the expense of consumers and hard-working appraisers. Hopefully, Fannie and Freddie will go along with FHA and leave it up to the mortgage professionals to choose the appraiser. With any luck, Freddie Mac will follow Fannie Mae's lead on the 105 percent refinances and allow borrowers to shop for the best rates through any lender, not just Freddie's favorites.
Jeff Lazerson, president, Mortgage Grader, Laguna Niguel, Calif.
While I say “unchanged,” concern is growing. Since the Fed starting buying mortgage-backed securities, interest rates have remained both relatively stable and low and should continue to remain so. However, one concern I have is each of the last three years, rates have risen from April to June. With technical levels of support just below current trading levels, this could pose an issue if breached and rates could rise quickly. If you have not yet refinanced and have the ability to do so, I would not wait, and I would be inclined to lock.
Jim Sahnger, mortgage consultant, Palm Beach Financial Network, Stuart, Fla.
Interest rates will continue to hover right just under the 5.000 percent level for a 30-year, no-point loan. Glimmers of hope in the economy are being offset by some weak earnings reports. While there is currently no pressure that rates will increase anytime soon, when they do (and they will!), they will do so very quickly, very dramatically and without warning. If you haven't taken advantage of these rates at or near record levels, don't hold out for significantly lower rates.
David Kuiper, mortgage planner, First Place Bank, Holland, Mich.
Inflation concerns resurface after the Fed's April 28-29 meeting.
Dan Green, mortgage planner, Mobium Mortgage, author of TheMortgageReports.com, Cincinnati
I am starting to sound like a broken record, but it is all really simple. There is little left to move rates lower, so don't wait for that to happen, which means that rates will do one of two things: stay put or go up. There is no sense in waiting when the risk outweighs the reward. I feel rates will continue to hold at current levels in the near term.
Chris Sipe, Senior mortgage consultant, Mason Dixon Funding, Frederick, MD
It is strange how news about the banking system changed so much from the week of April 13-17 to April 20. Is it possible that all of the big banks went to Vegas over the weekend? The week of April 15 saw earnings reports which appeared positive, even though Citigroup's earning were suspect. On Monday, April 20, banks started talking about expanding credit losses. I have summed up all that I read as follows: Rates will go up or down because banks are doing good or bad because their mortgage losses are either known or unknown. This may or may not require money from the Fed or Treasury sometime sooner or later. I am sure of this, more or less.
Dick Lepre, senior loan officer, Residential Pacific Mortgage, San Francisco
I'm advising my clients to lock while conforming rates are still in the high 4 percent to low 5 percent range. The Fed's commitment to purchase MBS should keep rates low; however, spring and summer home-buying activity may put pressure on banks to control refinance volume by arbitrarily keeping rates slightly higher.
Mark Madsen, mortgage consultant, Raintree Mortgage, Las Vegas
With the coupon rates still paying very well on the bonds, unemployment still projected to increase, we will still a slight decrease in rates. However, if it makes financial sense, lock now.
Steve Levitt, Vice president of mortgage lending, Guaranteed Rate, Chicago
With 10-year Treasury levels only 0.10 percent away from the 3.00 percent barrier, we'll look to next week to see the way the market interprets for rate direction. Next week is a full lineup of potential "rate changing" actions with the Fed rate meeting and the scheduled buyback of U.S. government debt. These days, the direction of rates is driven by supply and demand and not focused on the usual risks to a bonds rate of return like inflation. Are rates at bottom at the 4.85 percent mark (assuming 1 point)? Only if the Fed decides not to accelerate U.S. debt repurchases. Either way, let's agree 4.85 percent is a great rate for borrowers in today's market.
Cameron Findlay, Chief economist, LendingTree.com, Charlotte, N.C.
The 10-year Treasury is 2.94 percent and continues to trade between 2.65 percent and 2.98 percent. The inflation component continues to fall, as deflation is more the concern than inflation over the next 12 months. While the inflation portion has dropped by 20 basis points, the 10-year Treasury has only moved 3 basis points. The Fed continues to buy Treasuries, but the rally in the stock market drives rates higher. We will continue to see this push and pull in the market for some time.
Mitch Ohlbaum, president, Legend Mortgage Corporation, Los Angeles
Banks are dealing with high refinance volume by raising rates. As demand decreases, rates could fall. But not much. Because of the uncertainty, the smart thing to do is to lock when you can, preferably for 60 days on a refinance.
Holden Lewis, senior reporter, Bankrate.com
Mortgage rates aren't showing much movement, and that will continue to be the case. Angst over the bank stress tests may push rates a little lower, but not much.
Greg McBride, CFA, senior financial analyst, Bankrate.com
About the Bankrate.com Rate Trend Index
Bankrate.com surveys experts in the banking and mortgage fields to see if they believe certificate of deposit and mortgage rates will rise, fall or remain relatively unchanged. For the deposit index, the panel comprises banks, thrifts and credit unions that directly offer FDIC-insured certificates of deposit to the end consumer. For the mortgage index, the panel comprises mortgage bankers, mortgage brokers and other industry experts who provide residential first mortgages to consumers. Results from Bankrate.com's CD Rate Trend Index will be released monthly. Results from Bankrate.com's Mortgage Rate Trend Index will be released each Thursday.