Mortgage Rate News

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It is increasingly looking as though October may be the time to buy a home. After all, many people will be rushing to take advantage of the tax credit being offered to first time home buyers. But even if you don’t qualify for a first time home buyer credit, October may be a good time to buy — if you have been planning ahead to buy a home — because there is the possibility of lower interest rates. Or at least the possibility that October is your last chance to take advantage of record-low mortgage interest rates before they start rising. Here is what Subprime Blogger points out about mortgage interest rates, Treasury yields and Federal Reserve policy:

No one knows how much yields will have to increase to be attractive to foreign investors but we can assume that 3.3% on the 10 year yield is not attractive.  If the 10 year yield pushes towards 4% like it did during the summer there is a good chance that we could see 6% mortgage rates coming in the near future.  This is not going to happen while the Fed still has both hands in the pot but it could happen when the Fed stops buying up Treasuries.

With this in mind, if mortgage rates are going to hit all time lows it is going to have to happen in October.  This is not to say that mortgage rates will not stay at low levels but all time lows will be out of the question without the Fed’s assistance buying treasuries.

And buying a home isn’t the only way to reap advantages of low interest rates. You can also refinance your home. Just realize that to get the best mortgage interest rates you are going to need a good credit score and a decently-sized down payment. Otherwise, mortgage lenders will not qualify you for the best interest rates.

Mortgage interest rates are moving — and they’re moving lower.

Thanks to the job report today, mortgage interest rates are heading lower as unemployment rises to 9.7%. Even though initial jobless claims are down, the bottom line is that the economy is still shedding jobs. However, it is good news that the economy is shedding them at a slower rate. And besides, jobs data is a lagging economic indicator according to The Mortgage Reports. Here is what The Mortgage Reports says about jobs data and mortgage interest rates:

In other words, jobs data doesn’t so much tell us about today as it tells us about yesterday.  It’s why mortgage rate are improving this morning. Wall Street expected the jobs data to be a little bit stronger than what it was.

All the talk of rising home values and consumer confidence levels may have left investors too optimistic about jobs and consumer spending.  Today, they’re shifting expectations and spelling good news for home buyers and rate shoppers.

In the end, this is good news for home buyers and those looking to refinance. For those who want to take advantage of the first time home buyer tax credit, it comes at a great time. Home prices are low, and there are incentives galore. For those looking to refinance, well, it’s just nice.

I’m excited because I thought I’d missed the boat by dragging my feet about the whole refinancing process. But now it looks as though I get a second chance. Which is great. Refinancing could really save me money in the long run. And with mortgage rates 1.5 points lower than when I bought, I could save thousands over the life of my home mortgage loan. I could save even more if I can refinance to a 15 year or 20 year loan. I mean, really, the current climate offers a number of opportunities for those who are in a position to make some new money moves.

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Always, it’s in the back of your mind that you should do something. Right now, as it relates to home mortgage programs introduced by the government, we are reaching the point of “sooner rather than later”. One of the programs that could be ending rather soon is the first time home buyer tax credit. Indeed, in order to get the $8,000 first time home buyer tax credit, you will need to close by November 30, 2009. But you have to realize that closing takes some time. I was able to close on my home loan in 45 days a couple of years ago (in some cases it can be done in 30 days), but normally it takes around 60 days. Here is what Bible Money Matters points out about scheduling your closing to take advantage of the first time home buyer tax credit:

Now when you think about closing on a home around November 16th, and considering that normally closings are done 60 days out by default (can be negotiated down in some cases), that means that you would have to put in an agreement on a house by September 16th in order to close on your house in time – that’s only about 3 weeks away!

He recommends closing by November 16th because Thanksgiving will wreck a number of home closing plans if you wait until the last minute. This means that it is time to get cracking!

Making Home Affordable Refinance

You have a little more time if you are looking for a Making Home Affordable Refinance. You can refinance your home up until June 1, 2010. But, again, some advance preparation is in order. You should realize that if you want the best rates, you will need to improve your credit score. Additionally, an appraisal will be needed on your home. This means that the whole process, like buying a home, could take 30 to 60 days. Or even 90 days. If you want to refinance to a lower interest rate, you also have to take into account the fact that mortgage rates won’t remain this low forever.

In the end, if you want to take advantage of mortgage programs, you need to get on it. Shop around for the best mortgage for you, and prepare ahead of time. There are some great incentives to buy a home or refinance the one you’ve already got. But if don’t act quickly, you may be out of luck.