Arizona Mortgage Rates for September 19, 2008. (BK-0907309)
Mortgage Related News For The Week:
Someone that we work with who has been in the mortgage industry for more than 20 years said something pretty insightful:
“The key to understanding and surviving today’s mortgage market is to forget everything you have ever learned about how it works and just come to work and see what has happened and what it now means.”
The overall financial markets had a week that has not been seen before in recent times — and the news has trickled down to the mortgage market. Some of the big stories of the week included:
Lehman Brothers files for bankruptcy
Merrill Lynch is acquired by Bank of America
AIG gets $85 bailout from the federal government
And finally…
Secretary Paulson announced that the federal government would purchase illiquid assets from banks.
What all of this news means to the average homeowner who is looking to purchase or refinance a home:
Turmoil on Wall Street means uncertainty on Main Street. If you are in the market to purchase or refinance your home, now is a great time to LOCK your rate in with your lender. Beginning with the news of the Federal Government taking over Fannie Mae and Freddie Mac a couple of weeks ago, rates have dipped in recent weeks. While it is possible that they may go lower, we think that the risk of them going higher outweighs the chance that they will go lower — so lock now if you possibly can!
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The government has already bailed out Fannie May and Freddie Mac, why do you think rates would increase instead of decrease?
Mike,
Great question, thanks for asking — and keep in mind that if we had a crystal ball and could predict rates, we would be billionaires and could possibly help with the government bailout.
Generally speaking, we are *not* in the business of predicting rates.
But — since we did say that we think that the risk of rates headed higher outweighs the possibility of them heading lower…
Here are 3 reasons that we see the risk of rates heading higher rather than the opportunity of them headed lower anytime soon:
1. The “bailout” package details have yet to be determined
2. Once it is determined, it will take some time for the markets to absorb what the official bailout package looks like and what the real impact will be
3. Because we are cautious, we think that rates are “good” now and if you have a loan in process, you should “get while the getting is good”
Want a more technical answer? Our friend Dan Green does a great job of explaining why he thinks rates are headed higher as well here:
http://www.themortgagereports.com/2008/09/bankratecom-m-2.html#more
Remember — 60% of the time we are right all the time on our rate predictions!
I completely agree with your predictions! rates are surely going to increase, your statistics and calculations are great!
Wow, I never knew about Arizona mortgage rates. That’s pretty informative, thanks for sharing it.