Although predicting anything can be difficult, we do have some good information to work with. Homeowners who are looking to refinance or get a home loan modification will greatly benefit from knowing when the lowest interest rates of the year will be available. Here, I predict mortgage rates for the remainder of 2009, and a few months into 2010.

Mortgage rates earlier in the year were at record low rates. A typical 30 year mortgage with a fixed rate would be around 4.69% in interest. This made a lot of homeowners reevaluate their mortgage, and try to get a refinancing or home loan modification into the super low rates which were available. Mortgage lenders and banks became the goto guys when the rates were this low, and they took in a large number of customers. Once they realized the extreme amount of paperwork needed to get done, something had to be done to stop the influx of homeowner mortgage refinancing or home loan modification applications. As a response to the increased paperwork and customer load, mortgage interest rates were raised .5%. This slight increase still made it possible for truly struggling homeowners to get relief, while at the same time, the increase held off some homeowners from applying until rates drop again.

This 5.19% mortgage rate should last until October or so, then homeowners can start looking for my predictions to some true. I predict that around October this year, home mortgage interest rates will be lowered again to 4.69%. This will be around the time mortgage lenders and banks have caught up with all of the prior customers and are ready to help a new round of homeowners before the year ends. I think that the 4.69% interest rate will stay true through April of 2010. This will give homeowners plenty of time to take action and get into a much more affordable mortgage through home loan modification or refinancing.

Predicting mortgage rates can never be 100% guaranteed. However, I do believe that the trends and forecasts of mortgage rates point to this .5% rater drop. Homeowners should wait if possible to get the lowest rates possible. If you are struggling though, and losing your home is a real possibility, then you need to take action now and get a home loan refinancing or modification before it is too late.

-M Petrone

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