Mortgage Interest Rates September 24 – Refinance Rates Remain Low
Posted on | September 24, 2009 | No Comments
Mortgage interest rates for September 24th, 2009 remain low despite the Fed’s commentary yesterday. The 30 year fixed rate mortgage is at 4.91% with the 15 year fixed rate at 4.31%. The 5/1 ARM is up slightly to 3.93%. Yesterday the Federal Reserve Bank reiterated that they are going to stop buying US Treasuries by the end of October. This should have pushed mortgage rates higher because it infers that less money will be going into treasuries which is likely to push yields higher.
If yields move higher, mortgage rates tend to follow. If this was the only statement from the Fed minutes it is likely that rates would have moved up. The Fed helped to keep mortgage interest rates low by extending the mortgage backed securities purchase plan through the end of March 2010. They did not mention that they were going to increase the amount of purchases but they were going to spread out the amount through the first quarter of 2010. This means that mortgage interest rates are likely to remain low as long as these purchases take place.
It will be very interesting to see if mortgage rates continue lower even after the Fed stops buying treasuries. Unless we see a great amount of foreign investment in treasuries there is going to be a short term rally in yields at the least. It is basic supply and demand. If the Federal Reserve isn’t buying treasuries the amount at which they yield is going to have to go up to make them attractive to other investors. How high these yields will go has yet to be determined. The higher yields go, the higher mortgage rates will go.
Make sure to check out Subprime Blogger on a daily basis for your mortgage interest rates. We will display the current rates as well as a short commentary similar to the above column. Bookmark the following daily mortgage rates category to gain easier access to our mortgage interest rates column:
Author: Heather Best
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