Home Loan Interest Rates Headed Up
Posted on | July 17, 2009 | No Comments
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Home loan interest rates, especially 30 year fixed mortgage rates, are sure to head up next week as the 10 year treasury rate yield continue to rise as the week closes out. This week has been a very strong week for the yield as it has moved up over 10% for the week. There is little doubt that this is going to cause average mortgage rates to move higher. It will be very interesting to see what a 10% weekly move in the yield will do to overall interest rates.
This is not a surprise to me at all as I have been harping on the fact that mortgage rates were at a very important junction in the road. I will admit I overestimated the lower trendline for the 10 year treasury rate yield, but I quickly corrected myself when I saw the movement earlier this week. It looks as if the 10 year yield is going to make a strong push towards 4% which means the 30 year fixed mortgage rate will make a strong case for 6%. It will be very interesting to see what this does to the “recovering” housing market.
Most of you know that I do not feel that the housing market is truly recoving; especially with foreclosure listings reaching new highs. There continues to be too much supply on the market and the unemployment rate continues to rise. It will be at least another six months before we see home prices bottom especially with mortgage rates moving up.
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