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Panel prediction
14% Up
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Will rates rise, fall or remain relatively unchanged? Experts and Bankrate analysts provide their insights.

This week (Feb. 12 – Feb. 18) the experts say: Mortgage rates probably will fall, or at worst remain about the same.

This week, half of the panelists believe mortgage rates will fall over the next 35 to 45 days. Another 14 percent think rates will rise, and around one-third believe rates will remain relatively unchanged (plus or minus 2 basis points).

Experts’ comments and Bankrate analysts
Experts’ comments Panel
Even with $400 billion left to buy mortgage backed securities, other indicators are offsetting the gains. Again, if you have the option to save $200 a month now, don’t wait months for a lower rate to save another $30, as that will create a breakeven point of years to recoup. Lock now if it makes financial sense.
Steve Levitt, vice president of mortgage lending, Guaranteed Rate, Chicago
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Given the current climate in Washington, it’s unfathomable interest rate cuts would not be included in the ultimate stimulus package. The administration has all the power it needs in Congress to push this through.
Dan Dowling, senior mortgage adviser, president, United Mortgage Capital Corp., Altamonte Springs, Fla.
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Rates will remain stable over the next few months.
Bob Moulton, president, Americana Mortgage, Manhasset, N.Y.
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Just following a small debt market sell-off last week (prices down, rates up), we are now faced with the opposite side of the coin, where perception caused by lack of confidence in Secretary Geithner’s plan has cleared the way for a debt market rally. Prices are now increasing and bond yields declining, but as for mortgage interest rates, don’t expect to see the decline in line with bond yield changes. We see flat interest rates with declining bond yields for the near term, resulting in wider yield spreads.
Cameron Findlay, chief economist, LendingTree.com, Charlotte, N.C.
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The 10-year Treasury is trading at 2.76 percent — a drop of 23 basis points — and this has translated into lower rates. As I mentioned last week, a big component of seeing lower rates will be the passage of the stimulus bill, which is getting close to being completed. Once this is complete, we should see another drop in rates. We are still looking for the Feds to come into the mortgage-backed securities market as a buyer to create some liquidity.
Mitch Ohlbaum, president, Legend Mortgage, Los Angeles
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Lenders have finally caught up with the underwriting backlog by artificially increasing rates. Now lenders are faced with massive numbers of borrowers that floated their rates instead of locking in. If the rates offered are anywhere close to a consumer’s goal (aka net tangible benefit), then lock it in and sign those loan documents.
Jeff Lazerson, president, Mortgage Grader, Laguna Niguel, Calif.
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Economically, based on inflation expectations, rates should continue to fall. However, the tsunami of paper flowing from Washington, D.C. will offset this and should keep rates in a trading range, albeit wider than a few basis points. Individual lenders rates may swing wildly, though, based on their capacity to take on new loans.
Jim Sahnger, mortgage consultant, Palm Beach Financial Network, Stuart, Fla.
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The Fed’s “tools” prevent rates from rising like they want to.
Dan Green, Mobium Mortgage, author of TheMortgageReports.com, Cincinnati
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The Treasury market has been getting hammered recently, as investors digest the massive cost of all the bailout and stimulus plans coming from Congress and the Obama administration. But that sell-off should moderate for a while, leading to some sideways chop for rates in the near term.
Mike Larson, interest rate and real estate analyst, MoneyandMarkets.com, Jupiter, Fla.
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The Treasury Secretary’s speech of Feb. 10 was poorly received by the equities markets partly because it came off as a “work in progress” a sort of “we are going to spend a lot of money and we are not sure on what” speech. I do not think this is what investors wanted to hear. Everyone was prepared for the speech to give equities a pop and send Treasury yields higher but the opposite happened. I do not disagree that no one knows exactly what to do, but people like me should be saying this, not the Secretary of the Treasury. Mortgage rates are still going to be dictated by the Fed.
Dick Lepre, senior loan officer, Residential Pacific Mortgage, San Francisco
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Bankrate’s analysts Panel
Tim Geithner says forthcoming details in the next few weeks will focus on bringing mortgage rates down, and when announced, that is probably what will happen.
Greg McBride, CFA, senior financial analyst, Bankrate.com
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Do you smell that? The Fed is cookin’ up another batch of MBS purchases.
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.