Monday, March 10, 2008

Mortgage Rates Are Actually Going Up

The Fed can (and probably will) continue lowering short term interest rates but it is not doing much to bring down long term interest rates that dictate how much people pay on most mortgages.

Look at what long term interest rates have done since the lows of mid January. This is definitely NOT good for the housing market.

According to “This week, a slim majority of the panelists believe mortgage rates will rise over the next 35 to 45 days. About one-quarter believe rates will remain relatively unchanged (plus or minus 2 basis points). The rest think rates will fall.”

Source: National Bubble

One important thing to keep in mind is that mortgage rates are based on more than just Fed rate

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