mortgage

Mortgage Rate Trend Index

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Will rates rise or remain relatively unchanged? Experts and Bankrate analysts provide their insights.

This week (Feb. 11 - Feb. 17) the experts say: Rates won't move much -- but if they do, they'll go up. This week, more than half of the panelists believe mortgage rates will remain relatively unchanged (plus or minus 2 basis points) over the next week or so. Another 40 percent think rates will rise, and a small minority believes rates will fall.

Industry experts and Bankrate commentary
Experts' commentsPanel
Profit-taking takes hold in the MBS markets.
Dan Green, TheMortgageReports.com, Waterstone Mortgage, Cincinnati
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The short-term tech is bearish (lower prices, higher yields) but as long as the Fed keeps buying agency debt (until the end of April), the rate increase should be small. With the weekly tech bullish I will go with "flat" for the short term. Concern must be expressed for what happens when the Fed exits the market at the end of March.
Dick Lepre, senior loan officer, RPM Mortgage Inc., San Francisco
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The economy is backsliding. Most lenders indicate business is off by 50 percent in the last 75 days. The good news is home equity lines are back. Higher ratios are acceptable. Cash-out refinancing one day after a property was taken off the market is a green light. Lenders need to feed the beast every month. Opportunity is knocking a little more loudly.
Jeff Lazerson, president, Mortgage Grader, Laguna Niguel, Calif.
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Mortgage-backed securities are facing pressure right now in light of recent Fed comments and the pending withdrawal of the Fed as a purchaser of mortgage-backed securities. While we had a nice little rally in interest rates last week, this has reversed course and I would expect to see rates bump up about 0.125 percent over the course of the next week. The message here is to lock in if it's an option for you. It is not a time to be complacent and think that low rates will be permanent.
David Kuiper, mortgage planner, First Place Bank, Holland, Mich.
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The 10-year Treasury is currently trading at 3.65 percent, which is up from 3.58 percent. Many were worried that the sheer size of this week's auctions ($181 billion!) would drive rates up, but that has not proven to be the case. While rates tend to bounce around slightly, there is not much that can move the rates significantly in any one direction. Until we see solid and significant improvement in the economy at large, rates are not going anywhere.
Mitch Ohlbaum, loan officer, Bank of America, Los Angeles
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Until we get clear direction from the Fed on the details of the exit strategy, rates may remain relatively unchanged. Chairman Bernanke repeated his promise on Wednesday to keep the federal funds rate exceptionally low for an "extended period of time," which should keep the carry-trade alive for a while.
Chris Karageorge, MinnesotaMortgageDaily.com, Universal American Mortgage Co., Wayzata, Minn.
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Concerns about the potential for a sovereign default of one the PIIGS (Portugal, Ireland, Italy, Greece, or Spain) nations will encourage a flight to the relative safety of U.S. Treasury bonds. This will keep bond yields and mortgage rates low despite the Fed ending its purchases of mortgage-backed securities which has been supporting low mortgage rates. Mortgage rates stay at current levels.
Michael Becker, mortgage consultant, Green Pastures Mortgage & Finance, Lutherville, Md.
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Not much news that makes me believe we will see any change in rates. No change for the next week.
Kevin Breeland, general manager, Residential Mortgage of South Carolina, Mount Pleasant, S.C.
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It finally seems that fundamentals are starting to take hold in the markets and people are realizing that regardless of the economic conditions at hand, rates have to go higher as the Fed is simply unable to play the same role in keeping rates low that they have the past 14 months. Rates are still comparatively great though, take advantage of them while you can. Expect them, though, to be a bit higher in coming weeks.
Jim Sahnger, mortgage consultant, Palm Beach Financial Network, Stuart, Fla.
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Bankrate's analystsPanel
If worries over Greece abate in the coming week, Treasury yields and mortgage rates will rebound a bit.
Greg McBride, CFA, senior financial analyst, Bankrate.com, North Palm Beach, Fla.
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Mortgage rates have held fairly steady all year. Why not for another week? However, the risk is all to the upside, so you should lock as soon as you profitably can.
Holden Lewis, senior reporter, Bankrate.com, North Palm Beach, Fla.
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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.

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