While mortgage interest rates are low, I predict that they will get lower. Every little interest rate percentage counts when refinancing a mortgage, and knowing when rates will be lowest ensures you will get the best deal possible. Here are my mortgage rate predictions for 2010 and the rest of 2009.

With mortgage rates being around 5.19% right now, many homeowners are refinancing or modifying their home loans to take advantage. However, if you can, wait. I think that around October of 2009, mortgage rates will drop by about .5% to 4.69% for a typical 30 year mortgage with a fixed rate loan. While this seems low, it can really add up, or be the difference between a refinancing actually saving you money, or just wasting your time.

Early in 2009, when the housing market was is its worse shape, mortgage interest rates were 4.69%. This is the same rate that I predict will be the average in October 2009. The rates were so low earlier because mortgage lender and banks wanted to help struggling homeowners and spur interest in the housing market. This plan worked a little too well, and homeowners quickly flooded mortgage lenders and banks with applications for mortgage refinancing. This was a shock to lenders as they did not expect such interest. Mortgage rates were increased by .5% to help stop homeowners form applying. This rate increase scared away homeowners who just wanted to save money, yet was low enough to help the majority of truly struggling homeowners. Many people took, and are taking advantage of these low mortgage interest rates, and saving money and their home from being lost.

Predicting mortgage rates
is tricky, but I do honestly believe the mortgage rates will drop by about .5% in October of 2009, and last through April of 2010. This will enable a lot of homeowners to save even more money when refinancing a mortgage. However, right now, interest rates are still low, and many homeowners can still benefit from taking advantage of the low interest rates for mortgages.

-M Petrone

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