Here's What aRecent CNNMoney.com Article
Had to Say . . .
Had to Say . . .
Since November 2008 the Federal Reserve has snapped up $1.25 trillion worth of mortgage-backed securities -- essentially, people's mortgages bundled together and sold to investors. When the Fed stops buying and cedes the playing field to private investors, they will almost surely demand better return for their risk. The Fed said it will taper off [purchases] gradually. Each week they buy less than the week before.
So far, though, the tapering has failed to spawn higher rates. Still, all of the experts agree that mortgage rates will climb. The good news is that none of them think the increase will be very large. Their projections are for a gradual run up to between 5.5% and 6% by December. That will add only about $70 to the monthly payment on a $150,000 note. That's still very reasonable and should not discourage many consumers.
Homebuyers may even find themselves paying less every month as housing markets continue to experience price declines. Industry experts are projecting further home price drops of 5% to 10%. Which would wipe out every bit, and more, of the monthly payment increases higher mortgage rates would bring.
CNN Money Article
So far, though, the tapering has failed to spawn higher rates. Still, all of the experts agree that mortgage rates will climb. The good news is that none of them think the increase will be very large. Their projections are for a gradual run up to between 5.5% and 6% by December. That will add only about $70 to the monthly payment on a $150,000 note. That's still very reasonable and should not discourage many consumers.
Homebuyers may even find themselves paying less every month as housing markets continue to experience price declines. Industry experts are projecting further home price drops of 5% to 10%. Which would wipe out every bit, and more, of the monthly payment increases higher mortgage rates would bring.
CNN Money Article
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