Mortgage Rates Garner Interest

Mortgage interest rates have been the topic of many dinner conversations lately. Right now, with low rates and low prices it’s a good time to buy. This is indisputable. Refinancing can be a little tougher as property values continue to decrease, impacting appraisals and creating an impossible loan to value ratio for banks. Many homeowners, who took advantage of adjustable rate mortgages a few years ago, find themselves stuck in unfriendly products and unable to refinance to take advantage of lower rates.

The upcoming presidential election has generated some interesting predictions for mortgage interest rates. Some say that if a Democrat is elected, the mortgage interest rates will increase. Others say that there will be no impact whatsoever.

Historically, starting with the Reagan administration, rates were high, up to 15%. The rates started to decrease as the first Bush administration neared its end, hovering around 9-10%. They continued a slow decline under the Clinton administration and increased slightly right after George II was sworn in. During the current Bush administration rates hit all time lows, around 5%.

Where the rates will go is hard to tell. The mortgage industry is still suffering from its recent meltdown. Inflation, price of oil and whether or not we enter a recession will be major factors. 

With instability in the mortgage industry and the upcoming election a possible factor in impacting the rates, a good time to act on that special property is now. Never before has there been a genuine sense of opportunity to invest if you are qualified to do so.