Obama Refinance Plan – Low Mortgage Interest Rates in Early 2010
Posted on | January 24, 2010 | No Comments
The Obama refinance plan was created to allow homeowners to lock into low mortgage interest rates. In early 2010 we continue to see the 30 year fixed mortgage rate below 5%. When looking at a historical chart of mortgage rates you can clearly see that this is one of the lowest levels we have ever seen. In fact, the all-time low for the 30 year fixed mortgage rate was set in November of 2009 at 4.49%.
The most recent quote for the 30 year fixed mortgage rate is 4.82%. This is getting very close to the 2010 lows of 4.8%. It would be no surprise to see 30 year fixed rates drop to 2010 low in the coming weeks. Unfortunately, this might be the end of the low interest-rate environment we have seen for quite some time.
Many analysts have predicted that interest rates are likely to move up in the near future. A Morgan Stanley chief economist has stated that he feels mortgage rates are likely to move to 7.5 % or 8% in 2010. If this is the case, many homeowners will no longer look to refinance their home loans. There will likely be a swarm of applications when mortgage rates start to move up near the 6% level.
Pres. Obama and the Federal Reserve Bank have worked very hard to keep interest rates low for an extended period of time. At the end of March of 2010 the Federal Reserve Bank is going to stop purchasing mortgage-backed securities which is likely to push mortgage rates higher. Some analysts have predicted that mortgage rates will move up one full percentage point when this purchase program concludes.
If this is truly the case then you will want to make sure to get your refinance application in sooner rather than later. The longer you wait the more likely it is that interest rates are going to rise. Even though we could see a slight drop in mortgage rates in the near future it looks like by the spring of 2010 interest rates will be on the rise.
Author: Mike Garner
Comments
Leave a Reply