Interest Rates - Up or Down?


There is never a short supply of people who will tell you that they know whether mortgage interest rates are going to go up or down.  You can get rich by selling advice on interest rates - half the time you're going to be right, and you only need to be right half the time to develop a very loyal following.

The reality is that no one knows whether interest rates are going to go up, go down, or stay the same.  Mortgage interest rates change depending on the demand for mortgage backed securities - mortgage bonds - and the big purchasers of those bonds (China, Japan, investment banks, etc.) just don't tell anyone how much they're going to buy.  If they did tell, then they wouldn't get as big a return on their investment.

No matter what you read online, or in the paper, or see on TV, you are not going to be getting accurate information about how much the bond purchasers are going to buy, so you will never be able to accurately predict where interest rates are going to go. 

Our best advice when it comes to locking in an interest rate is to lock it as soon as you know the closing date.  Your interest rate lock must be good through the closing date or you might end up having to pay for a lock extension, which can be very expensive. 

If you want to wait to lock your rate, just remember that you are gambling.  If someone advises you to wait to lock your rate because they think rates are going to go down, they are gambling with your money, and that's a pretty silly thing to allow anyone to do.


Getting a loan approved is easy - if you know what to do.  The Mortgage Experts know what to do!!!

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By the way, don't forget to refinance your current mortgage.  Rates are very, very low right now.  Don't miss out!  Call us today to get the details for your particular situation.

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