Colorado Mortgage Rates Spike Up Sharply by RJ Baxter

Colorado Mortgage Rates Spike Up Sharply by RJ Baxter

It's been awhile since I have blogged, it's been so busy in the office with rates at the lowest levels in the history of the country.  However, the past two weeks have seen a dramatic upward spike in Colorado Mortgage Rates.

I never thought I would say this, but the average 30 year fixed mortgage rate of 4.5% seems high compared to where Colorado Mortgage Rates were just a few short weeks ago.

Why has this occurred?  Despite the announcement of an additional $600B in purchase of treasuries by the Fed, rates have done nothing but climb since the announcement Nov 3rd.  Normally Colorado Mortgage Rates fall on such news. The reason for the spike is two-fold.

For one, most of the improvement in Colorado Mortgage Rates was already priced into the market, as the announcement by the Fed was one of the most telegraphed punches in the history of US economics.  The Fed had been alluding to this move for 6 weeks leading up to the meeting, so it was no surprise to the markets when it became reality.

Second, a string of positive economic data has emerged over the past month, sending investors into a frenzy with the seemingly rebounding economy.

So what is a home owner to do?  The bottom line is that rates are still at historic lows.  The difference in payment between a $250,000 30 year fixed mortgage at 4.25% vs. 4.5% is only $37/month.  With a rate at 5.5% or above, you can still save a lot of money over the life of your mortgage by refinancing.  It's impossible to predict if Colorado Mortgage Rates will go back down or not, but it's possible they could continue their rise and in the near future, even 4.5% won't be available. 

I would be happy to provide a detailed estimate and analysis of your situation to see if a refinance makes sense for you!