Mortgage rates will get worse before they get better!
It’s Friday, September 16th. Let me give you a quick, great update. And unfortunately, it’s going to get worse before it gets better. But we do see light at the end of the tunnel. First of all, Fed Chairman Powell is going to continue to raise rates at a hard pace. Most people think he’s going to raise rates next week, 100 basis points.
What does that mean? Your rates are not going up on a mortgage 1%, but car loans, credit cards, home equity lines of credit immediately. Those rates go up next week when he raises rates to try to tame inflation. So we are going to see and expect to see a little bit of a bump in mortgage rates, maybe as much of a quarter percent.
We’re starting to see interest rates get to that high five or 6% range. But here’s the good news. CNBC is reporting that Fannie Mae Fannie Mae is one of the largest purchasers of mortgages across the country. Their quasi government agency, they’re predicting interest rates to be in the low to mid 4% range by Q2 of 2023. Why do they think that?
Well, if we can get inflation in line, Powell is going to have to deal with the recession. And that means that we should see interest rates drop around that time. As always, if you have any questions for yourself or a client about current mortgage rates and what you should be doing, please let me know. Have a great day.
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