Buying a home can be a thrilling experience. You will have a home of your own, you will be starting a new chapter of your life and you will be ready and excited to get settled. Before you can get settled though, you need to stop and consider your mortgage interest rate. I know, not a very fun subject right? Well, I can’t promise I can make it fun, but today we are going to touch on some important factors that will help you understand what causes fluctuations in mortgages rates and what can help you determine the best time to buy.

10-Year Bond Yields

Although mortgages are generally packaged as 30-year products, the average mortgage is paid off or refinanced within ten years. Due to this trend, the movement of the 10-year Treasury bond yield is said to be one of the best indicators of whether mortgage rates will rise or fall. So what can you do to check on these trends yourself? Check out finance sites such as Yahoo Finance to get a glimpse of what is going on. If the 10-year bond rates are moving up, then mortgage rates are probably moving up as well. If the 10-year bond rates are moving down, chances are mortgage rates are too. Make sure that when you check this out you look at bond yields, not bond prices. These are two different things. Bond yields can predict interest rates.

Economic News

If you already read the news every morning, then this is a simple step you can take to keep yourself in the know. You know that tab, “Financial News” that most people avoid on their news homepage?  Yes, I know it to. Somedays it’s tempting to skip over it and go straight to technology, entertainment, sports or health.  Truth be told though; this tab is exceptionally useful for getting a decent prediction of mortgage rates. The guideline is simple. Negative economic news brings with it lower mortgage rates. So while the news may be disappointing, yay for mortgage rates! Contrarily, good economic news usually means higher interest rates. Check out stocks, job reports, home sales and gross domestic products. Overall, a growing economy is also a sign of growing mortgage rates.

Armed and ready with your mortgage rate compass you can get an idea how to navigate the ebb and flow of mortgage rates.

There’s no need for you to captain your mortgage ship on your own.  If you are wondering if this is a good time for you to buy a home and would like some expert advice about financing, give me a call!  I work with top mortgage advisers in Central Florida and I would be happy to make the introduction.  Contact me today to get started!  407-922-9011 |