Home Mortgage Loan Rates – Interest Rates Stable Before 2010
Posted on | December 30, 2009 | 1 Comment
Home mortgage loan rates have moved much higher in the month of December but interest rates have stabilized during the last few days of 2010. Wall Street has seen very light volume this week as it is a week between Holidays and many institutions are seen light volume when it comes to trading. The movement in home mortgage loan rates is likely to be very insignificant as the holidays slow things down greatly.
We will not know the true direction of mortgage interest rates until next Monday when we head full steam into 2010. Markets are likely to open with a bang and we should get to see the overall direction of interest rates a few weeks into trading. Obviously this can change at any time but if you keep an eye on the 10 year treasury rate yield you will be able to better predict where mortgage interest rates are headed.
Since the beginning of December the 10 year yield has made a strong move upward. The yield has went from 3.2% to 3.85%. Over the last few days we have see the 10 year yield pull back slightly which has help to stabilize mortgage rates. This cooling off period was expected as nothing can go up that quickly for that long. Do not be surprised if the 10 year yield does not pull back to its 50 day moving average around 3.5%.
This would be a steady drop but the move up in December cannot be sustained over a long period of time. With that being said, a chief economist at Morgan Stanley predicts that the 10 year yield will accelerate higher to 5.5% which would put mortgage interest rates around 8%. If you have been thinking about refinancing and you believe this economist then it is best to get that mortgage application submitted now.
Author: Alan Lake
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One Response to “Home Mortgage Loan Rates – Interest Rates Stable Before 2010”
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January 4th, 2010 @ 11:13 am
I agree that we will see some upward pressure on long term interest rates as we head into 2010. Probably not 8%, as long as the fed keeps buying up mortgages and with Freddie and Fannie getting unlimited support from the tax payer.