Why Have Interest Rates Jumped To A 7-Year High?

Interest rates for a 30-year fixed rate mortgage have climbed from 3.95% in the first week of January up to 4.61% last week, which marks a 7-year high according to Freddie Mac. The current pace of acceleration has been fueled by many factors.

Homes for Sale in Davenport FL

Sam Khater, Freddie Mac’s Chief Economist, had this to say:

“Healthy consumer spending and higher commodity prices spooked bond markets and led to higher mortgage rates over the past week.

Not only are buyers facing higher borrowing costs, gas prices are currently at four-year highs just as we enter the important peak home sales season.”

But what do gas prices have to do with interest rates?

Investopedia explains the relationship like this:

“The price…

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Mortgage Interest Rates Are Going Up… Should I Wait To Buy?

Homes for Sale in Davenport FL

Mortgage interest rates, as reported by Freddie Mac, have increased over the last several weeks. Freddie Mac, along with Fannie Mae, the Mortgage Bankers Association and the National Association of Realtors, is calling for mortgage rates to continue to rise over the next four quarters.

This has caused some purchasers to lament the fact that they may no longer be able to get a rate below 3.5%. However, we must realize that current rates are still at historic lows.

Here is a chart showing the average mortgage interest rate over the last several decades:

Bottom Line

Though you may have missed getting the lowest mortgage rate ever offered, you can still get a better interest rate than your older brother or…

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Economy Strong Enough to Raise Interest Rates

The Federal Open Market Committee voted Wednesday to raise interest rates for the second time this year to 1-1.25 percent, a move that was widely expected amongst economists and industry professionals and described as “prudent” by FOMC Board of Governors Chair Janet Yellen.

Back in March, they voted to increase the rate a modest quarter of a point to maintain the Fed’s goal of maximum employment and market stability.

The FOMC is of the opinion that waiting too long to scale back accommodations could potentially cause a rapid increase in rates, which could disrupt the market and send the economy into another recession. June’s rate increase reflects this continued belief, and follows Janet Yellen’s comments from March that, “we continue to…

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Fed Nixes Interest Rate Hike in May Meeting

After a two-day meeting, the Federal Open Market Committee has opted to keep the federal funds interest rate as-is—a surprise to many, given the widely held assumption that not one, but two more rate hikes were on the agenda for 2017.

According to the Federal Reserve, the improving labor market, moderate job gains, a lower unemployment rate, and steady inflation all factored into the Committee’s decision.

A statement from the Federal Reserve said: “In view of realized and expected labor market conditions and inflation, the Committee decided to maintain the target range for the federal funds rate at 3/4 to 1 percent. The stance of monetary policy remains accommodative, thereby supporting some further strengthening in labor market conditions and a…

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August 2016 Mortgage Rate Forecast (Purchase & Refinance)

Mortgage Rates Forecast For August 2016

Eight months into 2016, and mortgage rates are making a monkey out of Wall Street predictions.

According to Freddie Mac's weekly mortgage rate survey, 30-year mortgage rates are holding low, closing last month at 3.48%, on average, nationwide.

30-year mortgage rates are down more than 50 basis points (0.50%) since the start of the year. 15-year mortgage rates are down by a similar amount.

If you purchased a home within the last year, or if your mortgage is more than a few years old, you could possibly benefit from a refinance.

More than 7 million U.S. homeowners are potentially eligible to refinance. And, if you're buying a home, it's a good time to be looking.

Because of how mortgage rates have…

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