Mortgage Rates Finishing the Week Flat

With the week is winding down and mortgage rates are on track to finish out the week very close to where they started. There was no economic news today, so again investors and borrowers have to look elsewhere for direction. Current mortgage rates are expected to continue moving higher over the coming weeks and months so if you are thinking about taking action on a purchase or refinance, our recommendation is to lock a rate soon. . 

Where Are Mortgage Rates Going?                     

>>> Rates are basically finishing this week where it started.

Rates are on track to finish out the week mostly flat.  It has been another up and down week for financial markets in the United States. The big event of the week–the FOMC minutes, which did not fail to disappoint, signaling to investors that the Federal Reserve might be ready to hike the federal funds rate at a quicker than expected pace in 2018.

How fast are we talking? You will get a different answer depending on who you talk to, but the general consensus is at least three, possibly four. There are even some outliers now who are making the claim that there could be five increases this year. We are talking about quarter point increases, so four rate hikes would bump the federal funds rate up from 1.25-1.50% to 2.25%-2.50%.

The next opportunity for the Fed to take action is in one month at their March meeting on the 21^st . The fed is widely anticipated to follow through with their first quarter point increase of the year at that time.

For now, though, the speculation will continue about what happens after March. The greater the belief in a faster tightening schedule from the Fed, the more likely it is that mortgage rates will increase. So far this year we have seen a huge jump in mortgage rates, with the average rate on a 30-year fixed rate mortgage up past 4.5%.  That is no small spike and the climb is not expected to end anytime soon.

Rate/Float Recommendation           

>>> Lock in a rate soon.

Mortgage rates are expected to continue rising throughout 2018.   The long-term trend does remain, however, for them to rise considerably from present levels. Many analysts are still calling for rates to hit 5% at some point this year. In a rising rate environment, the decision to lock or float becomes complicated.  Obviously, if you know rates are rising, you want to lock in as soon as possible.