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Panel prediction
31% Up
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Will rates rise or remain relatively unchanged? Experts and Bankrate analysts provide their insights.

Rates are likely to remain flat. This week, Jan. 22 – Jan. 28, a little under one-third of the panelists believe mortgage rates will rise over the next 35 to 45 days. The same percentage think rates will fall. A little more than one-third believe rates will remain relatively unchanged (plus or minus 2 basis points).

Industry experts and Bankrate commentary
Experts’ comments Panel
While interest rates trended up at the tail end of last week, I believe that 30-year fixed rates will bounce around for a while in a narrow range of high 4 percent to low 5 percent. There is nothing fundamental that would indicate rates will continue to rise, especially with the Fed and Treasury committed to keeping liquidity and low interest rates. A short-term overbought position in bonds has led to the recent increase. Knowing this, if it makes sense to buy, build or refinance, now would be a good time to take advantage of a “known” rather than speculate on lower interest rates. When your mortgage professional recommends locking, please listen to their knowledge, expertise and advice, rather than trying to time the bottom and missing out on an incredible opportunity.
David Kuiper, mortgage planner, First Place Bank, Holland, Mich.
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With high impact economic indicators being washed out by the Fed buying mortgage-backed securities, along with the transition of a new president, rates will remain stable until the government makes the move. (These are) still historic lows, and remember, a 1 percent difference in rate for $150K loan amount only equates to a $100 difference in payment. If it makes economical sense, lock and close now.
Steve Levitt, vice president of mortgage lending, Guaranteed Rate, Chicago
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Mortgage rates have been range bound for the past few weeks (between 5 percent and 5.5 percent — assuming 1 point). With refinance volume booming, the Fed should soon start yielding the results of lowering rates to historic levels. Expect a temporary pause in price declines and a reduction in the excess inventory in part stimulated through a reduction in delinquencies. This suggests we have not yet seen the bottom of the home price declines, now expected to be reached in the first half of 2011. Also, the new FNMA guidelines taking effect April 1 will have a significant impact on not only rate but the psychology of the market.
Cameron Findlay, chief economist, LendingTree.com, Charlotte, N.C.
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It’s not a question of if, but when. The new administration wants to send a message that “there’s a new sheriff in town.” One of the quickest and easiest would be to dial down interest rates further than the previous president. The question is: Will he get to it in the next 30 to 45 days? In any case, we’re not in any danger of an increase in the near term.
Dan Dowling, senior mortgage adviser and president, United Mortgage Capital Corp., Altamonte Springs, Fla.
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Last week, mortgage rates skyrocketed for no obvious reason. President Obama will be sure to push those rate levers that point rates in a downward direction.
Jeff Lazerson, President, Mortgage Grader, Laguna Niguel, Calif.
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As investors work off the pipelines of loans from the past few weeks, I expect that rates will fall as the Treasury will continue to purchase mortgage-backed securities to keep mortgage rates low. Lenders have artificially inflated interest rates and are not offering accurate market driven rates in response to increased volume.
Jim Sahnger, mortgage consultant, Palm Beach Financial Network, Stuart, Fla.
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The stimulus package’s breadth will harm mortgage bond markets.
Dan Green, Mobium Mortgage, author of TheMortgageReports.com, Cincinnati
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I have observed a truly annoying trend. The Fed is buying FNMA paper and forced the FNMA 60-day buy rate down around 4.25 percent, but banks have not passed the lower yields to borrowers and are instead booking profits on the large spread. Granted, with the banking system having lost so much, profits to them are beneficial, but I am not at all comfortable with the fact that consumers are getting what is, in my opinion, a too small share of the benefit. This has to be discussed more.
Dick Lepre, senior loan officer, Residential Pacific Mortgage, San Francisco
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Bankrate’s analysts Panel
This week’s rise in rate might be a temporary bump.
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.