Mortgage Refinance Interest Rate Predictions

Even a small change in interest rates can mean a big savings for a homeowner looking to refinance their home. Here, I will predict mortgage interest rates for the rest of 2009, and a for a few months in 2010. Also, I will tell you why I think the rates will change for the benefit of homeowners sometime in October of this year.

Lets just get right to it. I predict that mortgage interest rates in 2009 will be lowered down to their previous lows of around 4.69% for the typical 30 year fixed rate home loan. Currently, rates are around 5.19% for that same loan type. While 5.19% is still really low, refinancing and saving .5% really adds up to a lot of money in the long run.

Homeowners have an average interest rate in this country of around 9%. A 4.69% interest rate is nearly half of that. The savings would be incredible if a homeowner could refinance into such a low rate. I think it will be possible in October of 2009. This is when I predict that mortgage interest rates will be lowered to their previous lows of 4.69%. If a homeowner can hold off until then, they should to take advantage of the lowest rates possible.

I predict mortgage interest rates will lower in October because this is when mortgage lenders and banks will be looking for a new round of homeowners applications for refinancing. Right now, and for the past few months, mortgage lenders, brokers, and banks, have been flooded with desperate homeowners looking to save money, or save their home from being lost. While this is good for homeowners, it quickly led to a paperwork nightmare for lenders, and rates needed to be increased to help stop the flow. While the rate increase was only .5% this was enough to scare off most homeowners just looking to save money, yet still allowed homeowners at risk of losing their home, a chance to save it.

The bottom line is, I think mortgage rates will be lowered in October of this year. While not by much, saving even .5% truly adds up to a significant amount of money in the long run.

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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.

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