CNN is reporting that as of April 1st, mortgage rates will most likely start to rise due to the fact that the government will stop buying up mortgage debt. Rates have stayed pretty low all year and it wasn’t uncommon to be quoted a rate below 5%. That may be going away soon, so now is the time to buy that home you’ve been watching in Cache Valley. If the federal tax incentive wasn’t enough, then perhaps this will get those of you waiting off the fence.
Homes for sale in Logan Utah and all of Northern Utah are plentiful and sellers are ready and anxious to receive offers. Act now and don’t regret missing the curve.
See CNN article below….
NEW YORK (CNNMoney.com) — There’s still time to get a 5% mortgage — but the window is closing.
On April 1, the government will stop buying mortgage-related debt, which will send interest rates slowly higher.
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.
The program has kept interest rates artificially low over the past year, with the price of a 30-year fixed-rate loan ranging between 4.93% and 5.09%, according to mortgage giant Freddie Mac.
That’s about 0.4 percentage points lower than these loans would have been without the government’s intervention, according to Jay Brinkmann, chief economist for the Mortgage Bankers Association.
But when the Fed stops buying and cedes the playing field to private investors, they will almost surely demand better return for their risk.
“Rates are going to be higher than they are now,” said Brinkmann.
How much higher is the question.
“It’s really hard to tell right now,” said Amy Crews Cutts, Freddie Mac’s deputy chief economist. “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….click her for remainder of article.
