Is their any way to find out if mortgage interest rates are going to go down?

Question

I want to refinance my home to lower my house payment but I'd like to see the interest rate drop some more before doing that. Is their any way to foresee if it's going to drop or raise?

Answer 1

If there was a sure thing way, it would be reported on the front page of your local new paper.
sorry

Answer 2

The economy and mortgage bond market determine such. A close indicator is the 10 year treasury index but one thing is for sure. If rates to drop a bit the regulations governing them will tighten accordingly. It is most likely the rates will either raise a bit or stay the same in exchange for a drop. Mortgage bond investors arent very eager to buy when rates are down. Tighter lending guidelines will sweeten the pot by adding better security to the bonds. Defaults scare away mortgage bond investors just like a class action suit scares away potential shareholders in a stock market trade. Rates are still lower than anyone would have imagined 10 years ago. If you do a streamlined refi from adjustable to fixed. Or take no equity and lower a fixed by at least 3/4 point you are likely ok. Remember however whenever you refinance other than a streamlined same lender type you can restart your loan seasoning and are paying mostly interest again. Everything in the financial future suggests rates must go up so if you do refinance do it this year. 2008 will be an election year and after that a major adjustment will be iminent, especially if the Democrats win. That said, the Republicans cannot keep this situation hidden foerever either. We will all be paying for mistakes made on both sides of the party lines.

Answer 3

It is highly unlikely (in my oppinion) that they will decrease.

Economists are constantly trying to figure out what the Fed will decide to do on the interest rate. There is no easy way to tell or even a 100% way to figure it out.

What I know about interest rates is this:
It often increases in times when the government needs to cut back consumer spending so they (the gov) can get the goods they need (ie: time of war). Oddly the interest rate actually dropped during this last war.

I have heard that more money is being planned for use on infrastructure (roads, etc) so that should help give the economy a little shot in the arm. When the government spends money on public improvements it pays for a lot of laborers. This help flow some government money into the hands of the people again.

So what do I think?
Taxes will increase
Interest rates will increase (slightly)
Economy will get a nice leveling out (strengthen, but likely won't improve too much)

By the way - I'm no expert. I've just taken a few classes on this stuff so I could be WAY off base.

Answer 4

Chances are they will continue to hold steady or rise. If you are what is called a subpime barrower, you can definitely expect rates to go up slightly in the near future. There is no way to know for sure in the long run though. It depends on how the market goes. Recently, people have been taking advantage of low home prices to purchase, so the demand is still there.

Answer 5

Not anytime soon. The Feds want to keep the led on inflation & will probably keep interest rate the same, till at least fall. We are living the housing bubble burst now & home prices has to drop 15 to 20% this year too. Investors are staying away from the housing market.
My advice, wait till fall.

Answer 6

There is no way to know for sure, but the present market would indicate a raise, not a lower.

Answer 7

I heard talk on Friday that the Fed was thinking about lowering the rate again. Anybody else hear this?