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Wells Fargo Refinance Mortgage Rates – Refinance in November?

Posted on | October 25, 2009 | No Comments

Wells Fargo refinance mortgage rates have been historically low for much of 2009.  If we subject the summer months, mortgage rates have been under 5% for the entire duration of 2009.  During the summer we saw the up trend in the 10 year treasury rate pull mortgage rates up but over the last few months the 10 year yield and rates have dropped back towards all time lows.  Should you refinance in November or are mortgage rates going to go even lower?

One of the main reasons that we have seen mortgage rates near all time lows for so long is that the Federal Reserve Bank continues to buy US Treasuries and Mortgage Backed Securities.  The Fed is going to conclude the purchases of US Treasuries by the end of October so this might have a short term effect on mortgage rates but the purchases of mortgage backed securities is going to continue.

As long as the Fed continues to buy mortgage backed securities we are not going to see mortgage rates move up drastically.  By concluding the purchase program of US Treasuries there is a chance that we could see a rally in treasury yields which will move mortgage rates higher but it should not move them drastically higher.

The Fed is going to continue to buy mortgage backed securities until the end of March 2010 but then what will happen?  In all reality, the Fed strongly hopes that the economy improves prior to this and investors jump back into these securities.  If that is not the case we could be in big trouble because mortgage rates are likely to move up very fast when the Fed stops buying securities and other investors are not interested.

This situation is not likely to occur until at least March 2010 so in the meantime it might be a great idea to go ahead and refinance at these low rates.  There is a good chance that we have seen the lowest level for mortgage rates because of the conclusion of the treasury purchase program.  Many lenders are still advertising low rates, including Wells Fargo, so make sure to take advantage of this while you can.

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Author: Jesse Wojdylo

Category: Wells Fargo Mortgage Rates

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