Wells Fargo Mortgage Refinance Rates – Interest Rates Stable at 5%
Posted on | September 20, 2009 | No Comments
Wells Fargo mortgage refinance rates have been around or at 5% for the entire month of September. For most of last week we saw mortgage interest rates fall to as low as 4.91% but we have seen a bounce back to the 5% level. With the psychological 5% floor being broken last week, it is likely that support level will now serve as resistance any time mortgage interest rates start to move higher.
Several times this summer we have seen Wells Fargo mortgage rates get down to 5% just to see them bounce back to 5.5%. Most of this was due to the fact that the 10 year treasury rate yield was finishing its up trend. For the entire first half of the year the 10 year treasury yield was in a strong up trend and it helped to keep mortgage rates above 5%. In all reality, the only reason that mortgage rates stayed above 5% for as long as they did is because of the 10 year yield.
The 10 year treasury rate yield is now down trending as the 50 day moving average is heading south. Any time we see a short term rally in the yield, the 50 dma is likely to serve as overhead resistance. It is interesting that the yield is very close to the 50 dma now. Sometime next week is it likely that we will see the yield hit this level and then continue its downward motion.
If the 10 year yield does continue its downward motion there is very little doubt that mortgage rates are going to follow. The lowest level recorded for 30 year mortgage rates is 4.78% and that is likely to be tested if the 10 year yield continues to break down. It might take until about mid-October but it is definitely a possibility with the Federal Reserve making it apparent that they are going to do their best to keep interest rates at historically low levels.
If you have been thinking about refinancing or buying your first home now is as good of a time as ever. Mortgage rates are under 5% and mortgage lenders are willing to actually lend you money which is unlike the mortgage market prior to March of 2009. Do not let this opportunity pass you by as you never know when mortgage rates will hit a bottom and start moving higher.
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Author: Alan Lake
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