In the last month we have seen a small increase in mortgage interest rates and in the last week, there was a small drop again! It's very difficult to predict exactly what is going to happen to interest rates, but we know they will only stay this low for a relatively short time!
This week there is some news that may affect rates. The August employment numbers come out on Friday, Sept 7th. If that report shows more new jobs than expected, we can see interest rates increase slightly. There is also a European Cental Bank meeting that may affect rates. The Federal Reserve meets Sept 12-13th and their announcement will be made in the afternoon on Sept 13th. There is already some talk of another quantitative easing (QE3) and some investors are expecting the Fed to release information regarding a new QE3 program. If the Fed does release a new program, mortgage interest rates may drop very slightly but there is only so much room for them to drop more than the current rates.
The Federal Housing Finance (FHFA) announced a .10% basis point guarantee fee increase for all mortgages sold to Fannie and Freddie for cash effective November 1st. We all know that Fannie and Freddie will pass that increase onto the consumer through interest rates.
Overall interest rates are expected to stay low into 2014. What we don't know is exactly how low they will be. We anticipate interest rates slowly increasing over the next year or so. I think rates should be fairly stable for the remainder of this year but with each economic report, there is room for that to change. Just remember if you are thinking about buying or refinancing, interest rates are fantastic right now!!
Leslie Vanderwerf, NMLS ID#335509, Summit Mortgage - Email - Website
