For those people who have been looking at homes and are on the fence, I would encourage you to act now and get your mortgage rate locked in, as I think some of today's events will lead to higher rates in the next few weeks, and possibly even today.

The early warning sign was the fact that the stock market rallied on negative news.  This morning's payroll report showed a loss of over 150,000 jobs in September. While this is a negative sign for the economy (these people won't be shopping), the stock market went for the reverse psychology and decided that this news would make the FED lower interest rates to try to help the economy. 

This is a set-up for Chairman Bernanke, because if he decides not to lower the Federal Funds rate, the speculative run-up from today would have been false, so the market will fall again - with the blame going to Bernanke, not the speculators.

The other big factor poised to raise rates is the likelihood that Congress will likely approve the bailout today.

As I had posted previously, here in Wenatchee with lots of available homes under $200,000 and many more under the FHA limit of $323,750, and with interest rates currently around 6.0% now is a good time for buyers to get into a home they can afford.

Just to clear the air on some FHA rumors- First Time Homebuyers and Veterans can still do 100% financing- (not all down payment assistance money has gone away),  and most other people still only need 3% down (3.5% is not yet in effect).

So if people are ready, now is a good time to close the deal and get into that new home for a great monthly payment.