This Week in Lending... Rates are surely but, luckily, slowly going up.....

By
Real Estate Agent with Keller Williams Realty

interest rates

Inflation concerns and a higher than expected January budget deficit caused mortgage rates to move a little higher during the week. Solid demand for this week's longer-term Treasury auctions helped prevent a larger increase in mortgage rates. Investors hoping for inflation relief from the Fed were disappointed. In testimony on Wednesday, Fed Chief Bernanke suggested that Fed officials view overall inflation levels as low and have no near-term plans to tighten monetary policy to fight rising inflation.

Over recent months, mortgage rates have moved higher due to investor concerns that future inflation will rise significantly. Inflation can come from different sources. A desirable source is inflation which results from stronger economic growth, which leads to more jobs and higher demand for goods. On the other hand, inflation which results from large budget deficits comes with very few benefits. Both are pressuring mortgage rates higher right now, but at least with an improving economy more people are able to buy homes.

On Friday, the Treasury released its recommendations for reforming Fannie Mae and Freddie Mac. According to Treasury Secretary Geithner, this report is a starting point for a national debate. The central question is what role the government should have in the mortgage market. Geithner stressed that changes will take place very gradually over a period of years to avoid disruptions to the housing market.

Christian Johnson, Shelter Mortgage

Posted by

Britney Elizondo

Buyer Specialist, REALTOR® | Vicki White Homes | a team within Keller Williams Dallas City Center | www.vickiwhitehomes.com

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Topic:
ActiveRain Community
Location:
Texas Dallas County Dallas
Tags:
interest rates
dallas texas real estate
home buying
mortgage
this week in lending

Spam prevention

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainer
27,261

Britney Elizondo

Your Dallas Home Buying Specialist :: 940.453.5308
Ask me a question
*
*
*
*