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Mortgage Rate Predictions – Mortgage Rates Around 5.2% in Mid August

Posted on | August 17, 2009 | 1 Comment

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Mortgage rate predictions have been very hard to make over the last few weeks as interest rates have been very volatile.  In the last three weeks we have seen mortgage rates go from 5.05% all the way up to 5.5% and now back down to 5.1%.  We are currently hovering around 5.2% but that could change in the blink of an eye with the way things have been going lately.  Making accurate predictions has been almost impossible because every time mortgage rates start to tick up, the Federal Reserve Bank has some type of commentary that forces interst rates lower.

If you have been following mortgage rates for an extended period of time, you know just how volatile the market has gotten.  For the entire month of July, mortgage rates stayed in a very tight range between 5.1% and 5.3%.  That all changed at the beginning of August when the 10 year treasury rate yield saw a huge weekly gain of over 10%.  This gain pushed mortgage rates all the way up to 5.5% and I honestly thought we were going to see mortgage interest rates work their way towards 6%.

When making mortgage rate predictions we often look at the trend and the trend of the 10 year treasury rate yield is definitely up so we would all think that mortgage rates would start trending up, right?  Well, that obviously seems to be the case, but every single time we see a slight dip in the 10 year yield there is a huge drop in mortgage rates almost all the way back down to 5%.  I realize much of this is due to Fed commentary but when is the market going to actually set interest rates?

The one thing that I must say is that the housing market does look to be getting better because interest rates have stayed so long.  New housing supply has greatly dropped and home prices seem to be moderating which is the first signs of a recovery.  I honestly hope we all don’t drink the kool-aid and start buying on huge amounts of credit again.  Wait, this is America, of course that is going to happen.  Hopefully this time people realize that they can’t do it with money they are likely never to see.

With that being said, this weeks mortgage rate predictions are as follows:

30 year fixed rate mortgage: 5.25%

You have likely seen advertisements on the Internet and television for mortgage rates under 5%.  Now is one of the best times in history to be in the market for a new home or refinancing your mortgage.  I would suggest getting out there and actually contacting some of these mortgage lenders to see if you can get a mortgage rate under 5%.  You will never know until you actually try!

Author:  Jesse Wojdylo

Category: Mortgage Rate Predictions
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One Response to “Mortgage Rate Predictions – Mortgage Rates Around 5.2% in Mid August”

  1. Mortgage Rate Predictions – The Fed Purchases $75 Billion in Mortgage Backed Securities : Subprime Blogger
    August 17th, 2009 @ 5:44 am

    [...] 17th – The current mortgage rate predictions article can be found here:  Mortgage Rate Predictions – Mortgage Rates Around 5.2% in Mid August.  Mortgage rates remain historically low and it looks like it is going to stay that way for some [...]

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