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Panel prediction
18% Up
46% rti-arrow-down Down
36% rti-arrow-unchanged Unchanged

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

This week (Feb. 19 – Feb. 25) the experts say: Mortgage rates will most likely fall, or at worst stay flat.

This week, a little under half of the panelists believe mortgage rates will fall over the next 35 to 45 days. Another 18 percent think rates will rise, and around one-third believe rates will remain relatively unchanged (plus or minus 2 basis points).

Industry experts and Bankrate commentary
Experts’ comments Panel
Rates will remain stable.
Bob Moulton, president, Americana Mortgage, Manhasset, N.Y.
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The spread between 10-year Treasuries and interest rates today is at approximately 250 basis points. Assuming that the 10-year Treasury is at 2.65 percent, we can expect interest rates around 5.15 percent. Since mid-December 2008, that spread has been as high as 327 basis points. Borrowers comparing the debt market (10-year Treasuries) with interest rates will need to be cautious because this spread has been getting wider in recent weeks. With news of the stimulus package along with overseas woes, U.S. debt prices have been driven higher (yields lower) all while mortgage interest rates have remained relatively unchanged. This means the wider spread is the risk premium banks demand from borrowers for perceived exposure in the mortgage market, suggesting things are getting worse, not better.
Cameron Findlay, chief economist, LendingTree.com, Charlotte, N.C.
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I still think will go lower and the 10-year is trading at 2.66 percent tonight, down 10 basis points from last week. Last week I said that a big part of seeing lower rates will be the passing of the stimulus bill, which happened yesterday, and we immediately saw slightly lower rates. Today the president will unveil the part of the package relating to housing and that will drive rates even lower. Look to lock your loans in the next seven to 10 days as we reach new lows.
Mitch Ohlbaum, president, Legend Mortgage, Los Angeles
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Some of the bailout money being printed will certainly be used by Treasury to buy up mortgages at cheaper rates. Responsible borrowers are going to get their piece of the money machine through lower mortgage costs. There is a moral hazard for our political leadership if only failed banks and broken down borrowers are served.
Jeff Lazerson, president, Mortgage Grader, Laguna Niguel, Calif.
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If you don’t like mortgage rates right now, just wait two hours — they’ll change.
Dan Green, Mobium Mortgage, author of TheMortgageReports.com, Cincinnati
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Bonds got beaten with the ugly stick earlier this year. They’re taking a breather now. That will take some of the pressure off mortgage rates, allowing them to stabilize in this area.
Mike Larson, interest rate and real estate analyst, MoneyandMarkets.com, Jupiter, Fla.
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The “stimulus” bill has passed and investor sentiment is negative. I suppose these folks feel there was not a lot of real stimulus in the bill. In any case we are seeing, as I a writing this, further flight to quality. With Treasury debt at such low yields and corporate debt dubious at best, we may seem increasing sentiment for mortgages which are backed by Treasury. This should drive conforming rates down.
Dick Lepre, senior loan officer, Residential Pacific Mortgage, San Francisco
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Bankrate’s analysts Panel
The government is committed to reducing mortgage rates. Enough said.
Greg McBride, CFA, senior financial analyst, Bankrate.com
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I’m writing this comment before President Barack Obama releases the mortgage relief plan. If the initiative results in a refinancing boom for troubled borrowers, it seems inevitable that rates will rise. Lenders lack capacity and credit quality will be low.
Holden Lewis, senior reporter, Bankrate.com
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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.