Mortgage Rate Trend Index
Will rates rise or remain relatively unchanged? Experts and Bankrate analysts provide their insights.
This week (Nov. 5 - Nov. 11) the experts say: There's almost an even split among those who believe rates will go up and those who think they will remain unchanged. This week, half of the panelists believe mortgage rates will remain relatively unchanged (plus or minus 2 basis points) over the next 35 to 45 days. Another 43 percent think rates will rise, and the rest believe rates will fall.
Industry experts and Bankrate commentary
The Treasury techs are all still bearish (lower prices, higher yields and mortgage rates). One issue of concern is the extent to which the housing market is on life support. It will take a least five and as many as 10 years before the housing market can stand on its own.
Dick Lepre, senior loan officer, Residential Pacific Mortgage - SF, San Francisco
Rates will go up slightly for a couple of reasons: 1) increased pressure on the dollar, 2) ongoing stress on the employment front and 3) a growing likelihood that nothing substantial will be done to change the banking system to prevent this from happening again. Oh, and the government's bailout/stimulus madness will keep getting worse.
Tom Vanderwell, StraightTalkAboutMortgages.com, Fifth Third Bank, Grand Rapids, Mich.
Rates have been fairly stable the last few weeks after rising a bit in the beginning of October. This is despite the Fed ending its purchase of Treasuries in October and winding down its purchases of mortgage-backed securities. This tells me that the bond markets believe that any recovery will be weak and uneven. That is a belief that I agree with. I just don't see a robust recovery without an improvement in employment. While I don't see rates rising much until the employment picture improves, I don't see them dropping either.
Pay attention to the nonfarms payroll report on the first Friday of every month for and indication of where rates are going. For now rates hold steady.
Michael Becker, mortgage consultant, Green Pastures Mortgage & Finance, Lutherville, Md.
Mortgage interest rates seem to be stabilizing for the short term and will hover right around 5.000 percent (no points) for the near term. Continued weak economic news is holding rates down for the time being, but any glimmer of hope combined with the phasing out of Fed/Treasury mortgage bond purchases will cause rates to rise quite rapidly. Schedule some time with your local mortgage adviser and lock into some incredible rates. Remember to ask about refinancing options even if your property has significantly decreased in value, as there are very attractive programs to help.
David Kuiper, mortgage planner, First Place Bank, Holland, Mich.
"Too Big To Fail" banks are filing for bankruptcy versus helping small-business owners obtain the gap financing that is essential in keeping people working. With foreclosures and unemployment on the rise, I anticipate that the Fed will do everything in its power to keep mortgage rates low through the rest of the year in order to encourage consumer optimism during the holiday buying frenzies.
Mark Madsen, mortgage consultant, Raintree Mortgage, Las Vegas
Rates should hold steady for the time being as the government buying of mortgage-backed securities has done an excellent job of providing stability to the market. That program will continue in the spring of 2010, so it stands to reason that the stability will remain also.
Chris Sipe, senior mortgage consultant, Mason Dixon Funding, Frederick, Md.
With the Fed announcing their commitment to keep the funds rate low for as long as they can, along with inflationary indicators feeling the pressure, rates will remain unchanged. This is a great time to buy with rates low, inventory great, sellers motivated and the tax credit extension granted.
Steve Levitt, vice president of mortgage lending, Guaranteed Rate, Chicago
Both decreased mortgage-backed securities, or MBS, purchases from the Fed and potential downgrades on existing MBS pools could play havoc with rates. I don't expect a straight line higher as some days will offer better rates than others.
This week, the big news on factors impacting overall interest rates will be the employment report on Friday. If I were looking to obtain a mortgage today I would likely be locking very early into the application process. If I were considering a refinance, I would apply now and lock quickly with a lock window of not less than 45 days.
Jim Sahnger, mortgage consultant, Palm Beach Financial Network, Stuart, Fla.
Don't fight the Fed.
Dan Green, TheMortgageReports.com, Waterstone Mortgage, Cincinnati
The Fed shows no inclination to raise interest rates or otherwise deviate from the course, but another large government debt auction on tap for next week will keep mortgage rates from falling.
Greg McBride, senior financial analyst, Bankrate.com
With rates remarkably steady in the last few weeks, it seems logical that they will stay that way for a while longer.
Holden Lewis, senior reporter, 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.