Mortgage Rate Trend Index
Will rates rise or remain relatively unchanged? Experts and Bankrate analysts provide their insights.
This week (Jan. 28 - Feb. 6) the experts say: This week, half of the panelists believe mortgage rates will rise over the next week or so. Another 21 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
Housing has collapsed again as the National Association of Realtors reported yesterday a 16.7 percent drop in home sales. Voters are not happy with our government leadership regarding the lack of attention to the No. 1 issue -- the economy. In addition to lower rates, you may see the government waive appraisal requirements on noncash-out refinances.
Jeff Lazerson, president, Mortgage Grader, Laguna Niguel, Calif.
A rally which started the week of 1/25-1/29 has driven the weekly tech to upcross to bullish. With the daily and weekly now both bullish we should see lower Treasury yields and mortgage rates. Since we are now forecasting here for the next week, the problem with this bullish forecast is that the daily is nearing the end of its bull (higher prices, lower yields) cycle.
Dick Lepre, senior loan officer, RPM Mortgage Inc., San Francisco
Mortgage rates have dropped about 0.25 percent since the beginning of the year. This is because investors are getting nervous about the strength of the recovery. On Friday Jan. 29 fourth quarter GDP is reported. I expect that report to show strong growth in the fourth quarter of 5 percent or more. This will cause the stock market to rally and bonds to sell off, causing mortgage rates to rise. On the following Friday the nonfarms payroll report comes out. This is the unemployment report for January 2010. I expect this report to show more job losses. Bonds will rally on that news sending mortgage rates lower. So if you can get through the GDP report of this week I think we are in store for lower mortgage rates in a week or so.
Michael Becker, mortgage consultant, Green Pastures Mortgage & Finance, Lutherville, Md.
Investors will be listening closely to the State of the Union, and watching the Treasury auctions, in the days ahead, however, with the housing numbers coming out showing declines, and unemployment still challenged, we will continue to see the rates remaining unchanged/stable.
Steve Levitt, vice president of mortgage lending, Guaranteed Rate, Chicago
No surprises after Wednesday's FOMC meeting. The Fed will still end the MBS purchase program on 3/31. Mortgage markets react sharply to news, even if the "news" is the same old story. Look for mortgage rates to increase in the near-term.
Chris Karageorge, senior home loan advisor, Universal American Mortgage Co., Wayzata, Minn.
I feel rates will remain unchanged primarily due to lack of consensus. Investors can't make up their mind(s) based on the information available. That will change at some point, but lack of consensus leads to a "stalemate."
Chris Sipe, senior loan officer, Embrace Home Loans, Frederick, Md.
The Fed has spoken. They intend to let the mortgage-backed securities (MBS) purchase program come to an end in March. Expect that additional pressure will build in MBS as traders are forced to think about where rates should be in the absence of the Fed.
Jim Sahnger, mortgage consultant, Palm Beach Financial Network, Stuart, Fla.
The reality of the Fed's mortgage market withdrawal sets in this week.
Dan Green, TheMortgageReports.com, Waterstone Mortgage, Cincinnati
The Fed seems intent on wrapping up mortgage bond purchases at the end of the first quarter. Economic worries notwithstanding, this will eventually push mortgage rates higher.
Greg McBride, CFA, senior financial analyst, Bankrate.com, North Palm Beach, Fla.
Of course we're going to see higher rates, and probably rather soon. But this survey asks us to predict what will happen to rates in the next week. The secular rate increase won't begin that soon.
Holden Lewis, senior reporter, Bankrate.com, North Palm Beach, Fla.
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.