A lot of people are very interested to have an idea of where home mortgage interest rates will head in 2009. Even with the housing stimulus plan in full effect, the economy, and especially the housing market, are struggling. Right now, interest rates have jumped around .5% from just a few weeks ago, as I predicted they would in January.

Here is the exact quote of mine “Over all I predict that home mortgage rates for 2009 will take a temporary .5% increase followed by steady steep declines throughout 2009.” It is pretty easy to understand why I made that prediction, and how I predict mortgage rates will go in the future. For example, back in January I knew that with the super low interest rates available, homeowners would flock for refinancing or loan modification. They did, and lenders will overwhelmed with paperwork and the like. This led to a temporary (which just happened) rate increase of about .5% across the board on all mortgage interest rates. This mainly is to help ease mortgage lenders and banks workload while other refinancing applications are being reviewed and closed on.

For the rest of 2009, I predict that the current home interest rates will remain the same throughout the next 3 or 4 months. After that, I think the rates will start to go down a .25% or so, followed by another .25% drop either at the end of this year or early next year.

Always remember that only homeowners with the very best credit score will be eligible for the lowest of all interest rates, but even homeowners with bad credit should be able to get a reasonable deal on their home loan modification or refinancing. Homeowners should also know that even though rates have recently increased a little, the current rates are really low nonetheless and a refinancing or modification of a home loan can still be very beneficial for a homeowner in the right financial situation.

-M Petrone

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