Refinance Home Loan Rates – Fed Keeps Mortgage Rates Low
Posted on | October 30, 2009 | No Comments
Refinance home loan rates remain extremely low with a lot of this being due to the Federal Reserve Bank. The Fed has purchased mortgage backed securities and US Treasuries since the beginning of March and this has greatly aided the drop in mortgage interest rates. If things continue the way they have for the first three quarters of the year, 2009 will show the lowest average mortgage rates in history.
The Federal Reserve Bank is going to stop their purchase program of US Treasuries by the end of October which should affect mortgage rates. The logical explanation for what will happen is that treasury yields will increase which would cause mortgage rates to move higher. There is a strong possibility of this but we will see what happens.
With the conclusion of the Federal Reserve Bank buying US Treasuries we will see if any other programs are created to keep mortgage rates low. With the Fed still buying mortgage backed securities it is unlikely that we will see mortgage rates move up drastically. There is a great chance that rates will move up but probably to the 5.5% to 6% range.
If you have been thinking about refinancing or buying your first home now is one of the best times in history. With mortgage rates at low levels there is no reason you should let this opportunity pass you up. There are many lenders out there that are more than willing to help you refinance at low rates so make sure to contact them and see what they can offer.
It will be very interesting to see how much longer the Federal Reserve Bank can keep mortgage interest rates low. It is likely that they will stay relatively low until March of 2010 but will we see a bounce at the beginning of November because treasury yields increase? Only time will give us the answer but it will be sure to be an interesting ride.
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Author: Jeremy North
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