Obama Refinance Plan – Low Mortgage Interest Rates Continue into February
Posted on | January 19, 2010 | No Comments
The Obama Refinance plan was created to help Americans lock into a low mortgage interest rate to save money on their current mortgage. Since President Obama took office mortgage interest rates have been extremely low and it looks as if they are going to remain low going into February. Many analysts have predicted that interest rates are going to increase in 2010 but it has yet to happen.
A Morgan Stanley chief economist predicted that mortgage rates are going to move as high as 7.5% to 8% on the 30 year fixed rate mortgage. He made this prediction because he feels that the 10 year treasury rate yield is going to move higher by as much as 40%. If this happens you can be rest assured that the 30 year fixed rate mortgage is going to go up in the very near future.
Recently we heard that the Boston Fed President thinks mortgage rates are likely to move up by the spring of 2010. At the end of March 2010 the Federal Reserve Bank plans to stop their mortgage backed securities purchase program which is likely to push mortgage rates higher. Most analysts feel that the conclusion of this purchase program will increase mortgage rates .5% to 1%.
Just last week the CEO fo JP Morgan Chase, Jamie Dimon, made comments that the big banks is starting to restructure based on higher interest rates in the near future. Jamie Dimon has often been tauted as the best “big banker” on Wall Street so when he talks most people listen. It will be interesting to see what business model JP Morgan Chase uses for these higher interest rates.
With so many analysts and men of power predicting higher mortgage interest rates in the near future it might be a good idea to lock into a low mortgage rate sooner rather than later. If you continue to wait you could see mortgage rates closer to 6% than the 5% levels we are seeing in late January.
Author: Mike Garner
Comments
Leave a Reply