Home Loan Interest Rates Rise Across The Board

May 13, 2005 LOS ANGELES -- Home mortgage interest rates stepped-up a notch this week in harmony with one another. The increases in 30-year, 20 year, 15 year and ARM (adjustable rate mortgage) programs were slight, and furthermore it is widely agreed-upon by analysts as a surprisingly small bump northward, all things considered.
For instance, at the end of March the 30 year interest rate average was at a the six percent marker. Folks watching the market at the time speculated unanimously it seemed that by mid-May rates would be climbing above the 6 1/2 percent marker making current ARM mortgage holders sweat in their boots. Just goes to show predicting the economy is about as easy as predicting the weather.

Scrutiny by the Bond market has brought no conclusiveness with which players can hedge their game. Meaning, they are oblivious as to the overall pace of our economy in the long term. For this reason, the bond yields have remained remarkably low. This forces interest rates up.

Now that we have a little bit better yardstick on how exactly "measured" the Fed's "measured pace rate increases" really are is isn't out of line or risky for me to say that I predict rates will hit the 6.5% notch by the holidays. I've been wrong before, but I'm giving you the go-ahead to write it on your calendar. If I'm wrong I welcome the slaying's I'll get by email.

News article by Stockton Marquette, Mortgage Industry Analyst

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