Mortgage Rates Move Up On Every Loan

Mortgage Rates Move Up On Every Loan

11/10/2015

With the October 2015 Jobs reports coming in stronger than anticipated, followed by a Federal Reserve meeting and the announcement of a potential rate increase in December 2015, Mortgage Rates have been moving swiftly higher.
The Bond Markets have taken a defensive posture and smart money has been moving to the sidelines. The October 2015 Jobs report indicates an improving economy. Non Farm Payrolls increased by 271,000 new jobs created.
Dropping the official unemployment number down to 5.0% This positive news in the labor markets sent Bond Traders into a panic and they began unloading Treasuries in rapid succession. We have now had 6 consecutive days with a Sell Off in Bonds and Increasing Mortgage Rates. Current rates are still at Historic Lows with 30 Year Fixed Rate Mortgage averaging near 4.0% and 30 Year Fixed Rate FHA Loans at 3.875%. 15 year Mortgage Rates are now moving towards 3.25%

How will rising rates impact your ability to Borrow Money or Purchase a Home?

Rising Rates in 2016

Freddie Mac’s 2015 U.S. Economic & Housing Marketing Outlook.

How will rising rates impact your ability to Borrow Money or Purchase a Home?

Depending on how much money you anticipate borrowing, a half of a percent (.5%) increase in rate will increase your monthly mortgage payment substantially. Are you ready to buy today or wait until next year when rates could be much higher?

There are many consideration; If you wait to buy your home and rates move up, this could mean you don’t qualify for a new loan because of Debt to Income Ratios.
Many Real Estate experts also predict that home prices will continue appreciating 5% higher during the year.
If these projection are true that means the cost of money and the cost of home have increased. Pricing some borrowers out of the marketplace for a new home purchase.
Conclusion:
Even a small increase in Mortgage Rates could change your ability to qualify for a new loan or buy a new home.
If you are considering a Purchase Money Loan or Refinancing your existing home loan, there may never be a better time than right now!