Jul 22, 2009
Fixed Interest Mortgage Rates - Up or Down This Week?
Fixed Interest Mortgage Rates have been down for the last few weeks, but we could be seeing an up trend begin. The Federal Reserve Bank has worked hard to keep mortgage rates lower but if the 10 year treasury rate yield continues its uptrend, eventually mortgage rates are going to follow. There is a very strong correlation between mortgage rates and the 10 year yield. When one goes higher, the other generally follows shortly after. The 10 year treasury rate yield has been in an up trend since the beginning of the year and the trend has not broken its lower support level.
The first two days of this week brought a decline in the 10 year yield but today we saw a bounce that was likely off the lower trend line which is up trending. If the 50 day moving average and the lower trend line continue to hold as support, the 30 year fixed rate mortgage WILL increase. If the yield reaches 4% which may predict it will, we are likely to see mortgage rates in excess of 6% in the very near future.
If this is alarming to you, please make sure to educate yourself on the current mortgage market. If you have been thinking about refinancing or getting a new home loan, now might be the time to do it as interest rates are still low and that may not last for very long.