With all of the recent problems in the housing market, and general economy, predicting interest rates can be tricky. However, we can look at the basics of the market and easily spot and predict trends which can be beneficial in finding, or predicting, the lowest interest rates.

Right now as I write this, mortgage interest rates have raised about .5% to a national average of 5.25%. While these rates are low, they are not as low as they were just a few months ago. This may be in part to the effect of President Obamas “Making Home Affordable” plan, which helps millions of homeowners stay in their homes and prevent foreclosure. The recent rise in interest rates could be reflecting the plans effectiveness, and the stabilizing of the housing market. With less government intervention in keeping mortgage rate artificially low, the interest rates will rise again. Although, they in my opinion, can not rise too much more from where they are at right now. Although the housing market is starting to slowly come back, the lenders and banks still have a record number of foreclosures, and mortgage defaults on their hands. They can not risk additional problems and therefore will not be able to risk them by raising interest rates to the levels they were at a few years ago, for the financially stability of their existing and potential customers.

While nothing is certain, I am pretty sure that right now is about the lowest home interest rates will be for years to come. Also, remember that if in the future, interest rates drop low again, you can always refinance or modify your home loan in order to take advantage. Now more than ever may be the time to pounce on the low, government influenced, interest rates and get that home you deserve.

-M Petrone

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