Interest Rates Predicted to Reach 6%

January 21, 2010 · Posted in News · 1 Comment 

Interest rates are likely to rise to 6 percent by the end of 2010, predicted Amy Crews Cutts, deputy chief economist at Freddie Mac.

The end of the Federal Reserve program that buys mortgage-backed securities will drive rates higher because private buyers will demand more return than the Fed.

“Extraordinary resources have been put into keeping the rates down and supporting the mortgage markets and it’s hard to imagine that the rates can go much lower than they are,” Crews Cutts said. “Anything we get at or below 5 percent is a gift at this point.”

Source: Washington Post, Dina ElBoghdady

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Mortgage Applications Up as Rates Slip

January 21, 2010 · Posted in Manhattan · 1 Comment 

Mortgage application volume increased 9.1 percent last week compared to the previous week on a seasonally adjusted basis, according to the Mortgage Bankers Association.

On an unadjusted basis, the index rose 10.4 percent, but was down 52.3 percent compared with the same week a year ago.

Much of the decline compared to the previous year pertained to refinances. The unadjusted purchases index increased 9.8 percent compared to the previous week and was down 19.1 percent from a year ago.

Interest rates decreased last week:

30-year fixed-rate mortgages decreased to 5.00 percent from 5.13 percent.
15-year fixed-rate mortgages decreased to 4.33 percent from 4.45 percent.
1-year ARMs decreased to 6.72 percent from 6.83 percent.

Source: Mortgage Bankers Association

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