MORTGAGE RATES ARE MOVING BACK UP
Have you waited too long? 
We have been advising potential buyers for months that housing prices and interest rates are so low that it is time to take the plunge. The present housing market is one that we are not likely to see again in our lifetime. Some have decided to follow our advice while others have not.
Some tell themselves that they are waiting for the bottom of the market. The problem is that the only way to know when we hit the bottom is when we look back at the data for several months so that we can identify when it happened. Hindsight is always 20/20.
We cracked our crystal, so we are not very good at predicting the future.
What we can tell you is that mortgage interest rates are on the way up. The average rate for a 30-year fixed-rate mortgage is back above 4% now and the pundits tell us that they are destined to keep going up through 2012 and 2013.
You may not be aware of the fact that a few decades ago people were paying as much as 17%! The low 4% range is still EXCELLENT.
Fortunately, rates are not skyrocketing, so there is still time to act. Of course, the longer you wait the higher rates are going to be.
The current market conditions are also ideal for those with sufficient equity to refinance and lower their monthly mortgage payments. The key factor is the amount of equity an owner has in their property. Anyone with a 25% equity interest in his or her home that is paying 6% or above is just GIVING money to their lien holder. How do you like making investors richer?
Granted, lenders are more particular about whom they loan money to in our current market. The days of the fast and furious lending spree with “Liars Loans” and negative amortization loans have gone the way of the Klondike Gold Rush. However, the award goes to the persistent. They will look back on these good old days, when you could get a mortgage loan for 4%!
Select this link for a recent Wall Street Journal article on this subject:
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