Mortgage Interest Rate Predictions For 2009 - 2010

Even a small percentage difference makes a huge difference when is comes to mortgage rates. Homeowners looking to save the most money through refinancing or mortgage modification would benefit from having a good idea of what to expect from mortgage rates in 2009 and 2010. Here are my home mortgage rate predictions for the rest of this year through 2010, and how I made them:

4.69% was the average rate for a typical 30 year fixed rate home loan earlier in 2009. However, since these rates were so extremely low, homeowners rushed to mortgage lenders and banks to refinance or get a home loan modification. This quickly led to a record number of applications, and the mortgage lenders and banks got backed up with application from homeowners looking to save money. In order to slow down the amount of requests for refinancing or modification, the lenders needed to raise interest rates, in this case they did so by .5%. Right now a 30 year fixed rate mortgage can be had for around 5.19%. While theses rates are still very good, it made homeowners who just wanted to save money pause on applying, while homeowners who were truly facing financial hardships could still save their home. However, I think all homeowners will be happy with my mortgage rate predictions for the rest of 2009 and into 2010.

I predict that mortgage rates will drop to their prior lows of 4.69%, and this rate will last all the into 2010. Sometime around October 2009, I think the home interest rates will be lowered to this 4.69% rate in order to attract new customers, and help more homeowners who are facing foreclosure or other financial problems. I also think that this mortgage rate will last through April 2010 or so. Then will again be increased by at least .75%. So be sure to get a home mortgage refinancing or modification when the rates are, at least predicted by me, this low.

Homeowners facing financial hardships or losing their home should take action and do something about while interest rates are so low. Homeowners who are looking to save money and can wait, should.

At my site I will teach you how to properly refinance or modify a home mortgage saving you thousands of dollars, or even your home. A lot of Greedy Mortgage Lenders will try to suck you dry if you let them. Learn the right way to refinance or modify your home loan at my site: http://www.refinancingcondo.com

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Mortgage Rates Predictions As Forecast

For many homebuyers they always look at the mortgage rates predictions so that they will know when to purchase their dream home. But buying your dream house is not going to be based on what the mortgage rates predictions are. It is better for you to know how much can I borrow for a mortgage. Using mortgage calculators or home loan calculators can give more information and quotes that may be more useful in your search for a house or home loan.

Mortgage rates predictions are just a mere forecast as to where to rates are going and how they can affect your variable mortgage rates. It is very difficult to accurately predict where the interest rates are going especially when the main factors affecting rates are going in opposite directions. The US is reeling from economic difficulty and these major factors that control mortgage rates are pulling in unrelated directions.

Accurately determining where the mortgage rates are going can be extremely difficult with the opposing directions of the major indicators. The ever slowing US economy plus the subprime mortgage fiasco, it is putting too much pressure on mortgage rates to go down. With too many home foreclosures and the oversupply of homes for sale and buyers, the pressure is on to lower rates. But there are the pressures of inflation to contend with.

The price of fuel or gas and food is increasing by the day and it seems that there is no end in sight. Rising prices of commodities, fuel or gas and food are indicators of inflation. And when there is inflation, there is pressure for mortgage rates to go up. But you cannot just move the rates higher when there is too much of homes for sale and no buyers. It just not going to work that way. The main culprit in inflation is the Federal Reserve or central banks printing too much money and nothing to back it up.

There are other factors that determine how home mortgage rates go. Stocks and bonds an also play a role in the determining or predicting where the mortgage rates are going. But unless the central banks stop printing too much money and put into circulation, inflation will stick its ugly head.

With the economic crisis, the ever increasing inflation will force financial institutions and lenders alike to move interest rates higher. Accurately determining which of the factors will stood up will mean the difference between a correct mortgage rates predictions and one that is way out of estimates. But these are not the sole determinant in your search for how much you can borrow for a mortgage.

If You Are Shopping For A Home Loan, You Need A Mortgage Rates Predictions and For All Your Life Insurance Needs, Go to jfvfinance.com

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Mortgage Interest Rates - Predictions For 2009 and 2010

With so many homeowners looking to refinance or save money on their monthly mortgage, mortgage interest rates are very important. Luckily, we have some information that can help us make an educated guess as to what to expect from mortgage interest rates in the coming months. Here, are my mortgage predictions, and how I made them.

Although mortgage interest rates are low right now, I think there is still room for them to drop even further. While not by much, only .6% or so, every little bit counts. This .6% could be the difference between a beneficial refinancing or one which will actually cost you more money in the future.

The average homeowner who refinances now will get around a 5.19% interest rate for a 30 year fixed mortgage. This is unusually low, and many homeowners can save a lot by taking advantage of these historic low rates. However, for homeowners who are able to wait a little longer, I think there could be even more savings.

Sometime around the middle of October, of this year, I predict mortgage interest rates will drop. I think that rates will fall just below their lowest ever recoded rate of 4.69%, and will stay that way until April of 2010. This could be hugely advantageous for the homeowner who can wait a little longer to truly get the lowest rates possible. We are already seeing signs of slow rate drops, just as I thought would happen.

In October of this year, the mortgage lenders, banks, and brokers, will be hungry for a new round of eager to refinance homeowners. Last time rates were that low, the rush to refinance was on, and millions of applications flooded the offices of mortgage providers. This quickly led to a back log of paperwork. Now though, they are nearly caught up, and ready for more.

If you can wait, if not rates are still very low and you can probably save a lot through refinancing.

At my site I will teach you how to properly refinance or modify a home mortgage saving you thousands of dollars, or even your home. A lot of Greedy Mortgage Lenders will try to suck you dry if you let them. Learn the right way to refinance or modify your home loan at my site: http://www.refinancingcondo.com.

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Mortgage Rates Predictions - Will the Bail Out Help?

During the days leading into October, experts could not agree on mortgage rates predictions as to whether they will increase, decrease, or stay the same through mid-November. Almost half (47%) of the experts polled believe mortgage rates will rise. About 43% believe rates will fall slightly. The rest, about 10%, believe interest rates will remain relatively unchanged.

Those predicting higher rates say that if $700 billion from the bail-out is pumped into Wall Street, then supply could exceed demand in the bond markets causing a rise in mortgage rates Bonds are certificates of debt issued by a government or corporation guaranteeing payment of the original investment plus interest by a specified future date. The Bond Market Association estimates that mortgage debt makes up $6.1 trillion of the $25.9 trillion bond market.

Experts predicting lower rates say that if the Treasury purchases exclusively mortgage backed securities (MBS) rather than government backed securities, mortgage rates will drop.

Government backed securities are government debt obligations backed by the credit and taxing power of the country thereby having very little risk of default.

Mortgage backed securities are debt obligations that have been assembled into pools by accredited entities (governmental and private) and sold to investors. These pooled debt obligations are called Mortgage Backed Securities or MBS. The money banks make from MBS is loaned out to their customers. The banks don't have to worry if the customers have the assets to cover the loans they make to their customers because the banks sell the loans as MBS and get their money back that way.

Only time will tell how the bail-out money will be spent. How it is spent will directly affect mortgage rates Mortgage rates predictions for the next 18 months are that rates will fall. However, if inflation is not controlled, the long-term mortgage rates predictions will forecast increases in mortgage rates.

Read simple, to-the-point articles about avoiding costly mistakes and important subjects like refinancing mortgage rate at http://www.e-home-mortgage-loans.com/index.html

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Current Mortgage Rate Predictions

Making mortgage rates predictions is a little tricky. Financial markets, including those which set share prices and mortgage interest rates, are chaotic systems. This is not to say they are chaotic in the common usage of the term, meaning something with no order to it at all, but they are chaotic in the mathematical sense, in that the formulas which describe how mortgage interest rates are determined, which are the formulas used to make mortgage rates predictions, have self-referential components.

Making mortgage interest rates predictions is like making weather predictions - it is impossible to be precisely accurate with mortgage interest rates predictions, and the further in advance you try to predict mortgage interest rates, the greater the margin of error in the prediction.

On the other hand, chaotic systems are predictable in broad terms.

If you think about predicting the weather, you may not be able to predict the top temperature for a given day in August, but you can reasonably sure it will be within a certain range - say, if you live in Orlando, between 80 and 95 degrees F, and if you live in Copenhagen, between 16 and 25 degrees C.

Just as climate gives a broad indicator of summer top temperatures, economic climate gives a broad indicator of mortgage interest rates.

Factors Which Make Mortgage Rates Rise: Inflation

So called "real interest rates", the interest rates which move in response to supply and demand in the financial markets, are independent of inflation. To get from the "real interest rate" to the "nominal interest rate", which is what your bank will charge you for your mortgage, you simply add on the annualised percentage rate of inflation.

Factors Which Make Mortgage Rates Rise: Reduced Availability Of Credit

Financial markets operate on supply and demand. If there is a limited supply of anything, then it will go to those who are willing or able to pay more for it. The same is true of mortgage money. Mortgage rates predictions will take into account whether the supply of money is increasing or decreasing, and likewise, the trends in demand for money.

Factors Which Make Mortgage Rates Predictions Rise: Increased Risk

Apart from the underlying real interest rate determined by the broader economy, the rate of inflation, and the supply of money available for mortgage lending, there is another factor which comes into play in any investment decision - risk. Mortgage rates in general will depend on the overall risk involved in the housing market.

If house values plummet, as they have in some parts of the US, then the default risk for the banks suddenly increases, which means that they will be wanting to charge higher mortgage interest rates; predictions will take this upward pressure into account.

Factors Which Make Mortgage Rates Predictions Fall: Government Intervention

The US Government is an 800-pound gorilla in the financial markets. By issuing Treasury bonds at different interest rates, the government can influence the overall market for money, and thus affect the "real" interest rate.

Mortgage rates predictions based on purely economic considerations might indicate that mortgage interest rates are due to rise, but while the political pressure is running high, and in an election year, the government will do everything in its power, however economically irresponsible in the long term, to push the interest rate rises off until after the November elections. Mortgage rates predictions must take this political distortion of the financial markets into account.

Today's Mortgage Rates

Mortgage Rates Predictions

Mark Bennett is a staff writer for MoneyTalks.com, and contributes regularly to other financial sites.

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