Obama Refinance Plan – Federal Reserve Bank Keeps Mortgage Rates Low
Posted on | January 10, 2010 | 1 Comment
President Obama and his staff have worked very hard to keep mortgage rates low. The Obama refinance plan was created to help all homeowners to have the ability to refinance their mortgage to a lower interest rate. The Federal Reserve Bank has greatly helped to keep mortgage rates low by buying mortgage backed securities and US Treasuries. The Fed has stopped their treasury purchases but continues to buy mortgage backed securities.
At the end of March 2010 the Federal Reserve Bank plans to conclude their mortgage backed securities purchase program. At this point, many analysts have predicted that mortgage interest rates are likely to move up at least one full percentage point. No one knows if this will already be baked in at the time but there is a good chance that we could see some type of move higher in mortgage rates before then.
At the present time the 30 year fixed mortgage rate is around 5%. With a 1% move higher we are going to see rate above 6% which makes it much less attractive for homeowners to refinance. If might be a good idea to complete your mortgage refinance application sooner rather than later so you will have the opportunity to take advantage of the current low interest rate environment.
There are still many mortgage lenders that are advertising low mortgage rates so it should not be difficult to find a lender to help you with the application process. Make sure to find a lender that works will for your needs and will offer you an attractive interest rate. It is important to note that having a significant amount of equity in your home will go a long way towards getting a low refinance rate.
Author: Jeremy North
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January 10th, 2010 @ 11:59 pm
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