Why Are Mortgage Rates Going Up? - LoanLove.com Explains In A New Post
SAN DIEGO, July 4, 2013 /PRNewswire-iReach/ -- LoanLove.com has a mission to help consumers and borrowers alike in obtaining the latest information on mortgage lending trends, the real-estate market and the U.S. financial landscape for the purpose of helping them obtain a home loan they love. The team at LoanLove.com is devoted to help empower both first time and experienced homeowners with valuable resources, first-class knowledge and connections to top-rated industry professionals. To fulfill this goal LoanLove.com is continually updating their website with new articles and guides. LoanLove.com continues to help homeowners to understand the real estate market with their new article that answers the question "Why are mortgage rates going up?"
The article helps homeowners to understand why current home mortgage rates have risen so quickly after last year's record lows and what they should do if they had been planning to purchase a home or refinance their home loans. The Loan Love article says: "If you've been sitting on the fence, undecided whether or not to apply for a mortgage or to refinance your existing loan, you've probably worn out the toe of your shoes (and the seat of your pants) by kicking yourself repeatedly since the recent surge in interest rates. But all hope is not lost. Most financial experts say that while rates likely won't return to their former low levels, it's also not likely they'll have another similar jump before the end of the year. Of course, those are the same experts who predicted rates would remain low until the unemployment rate falls to 6.5 percent, so you might want to take that guidance with a huge grain of salt and lock in your rate now."
So what did cause mortgage interest rates to rise so fast within a few short days? Loan Love says that, just like many mortgage interest rate changes, this issue is tied up in bonds. The article says: "To help bolster the faltering economy, the Federal Reserve initiated a bond-purchasing program, spending $85 billion each month to buy U.S. Treasury and agency mortgage-backed securities to help keep interest rates low, in turn spurring consumer purchasing. But earlier this month, Fed Chairman Ben Bernanke told reporters the Fed could begin tapering off bond purchases in the coming months, perhaps even terminating the program by the middle of 2014. In a statement issued on June 19, the Fed also noted that it "sees the downside risks to the outlook for the economy and the labor market as having diminished since the fall." It also expects inflation to be at or below the 2 percent objective set to further economic recovery."
Basically these two announcements taken together caused stock market investors to run for cover and jack interest rates up. News of the announcements affected the mortgage industry greatly; the average 30-year mortgage rate jumped from 3.74 percent to 4.14 and the largest mortgage lender in the U.S., Wells Fargo, hiked its rates from 3.9 percent to 4.5 percent. But despite the jump, those who were unable to lock in the lower rates of earlier this year should not give up entirely. The Loan Love article says, "Although the rise in rates almost immediately resulted in a decline in mortgage applications, the housing market appears strong – so far. What's the take-home message? If you've hopped off the fence to attend your own, private pity party, stop playing Monday morning quarterback: Lock in your rate now, and save yourself the cost of another new pair of butt-kicking boots."
For more information on the mortgage rate increase, please visit LoanLove.com for the full article.
Media Contact: Kevin Blue, LoanLove.com, 949-292-8401, firstname.lastname@example.org
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