What's Happening to Mortgage Rates?

Everyone in the mortgage industry has watched rates creep up in the last few weeks. And these just aren't mortgage-related rates, but rates in general. If we throw in additional fees or mortgage insurance increases into the mix, watch out!

But what is going on out there?

The Fed doesn't set rates for home loans - the market does - but higher interest rates are intended to curb future inflationary concerns, which are a side effect of a growing money supply.I

If the value of money is expected to drop, those who lend it will require a higher rate of return (interest rate) to ensure they don't lose money on the loan over time. Inflation hasn't been much of a concern yet, but if prices are projected to rise, the Fed will eventually need to reign in its recent easy money policies. The Fed has done plenty to spark growth by slashing key interest rates, but their policy could change with recent positive news like home prices increasing 6% last year with existing home sales rising nearly 10% combined with decreasing unemployment.

As the economy begins to pick up steam, expect interest rates to rise over time. Even if rates go up a full 1% they will still remain low in comparison to rates we have seen in ten years.

Call me today to find out how you can take advantage of today's rates while they're still at generational lows.

Call 714-478-3153