Mortgage Rates Outlook For Home Purchase And Refinance

This BLOG On Mortgage Rates Outlook For Home Purchase And Refinance Was PUBLISHED On May 1st, 2019

Mortgage Rates Outlook for 2019 seems promising.

• Mortgage rates hit an all-time high in 2018 since the 2008 Real Estate and Financial Meltdown
• However, rates have been steadily declining since the beginning of January 2019
• Mortgage Rates hit a 22 month low due to the news the Federal Reserve Board will not be increasing interest rates for the remaining of the year
• This news sent mortgage interest rates sharply lower
• Current rates are hovering in the low 4.0%
• Many borrowers who closed on a mortgage loan last year got rates in the 5.0% range
• Lower rates mean more buying power for home buyers and huge savings for homeowners looking to refinance
• It also offers an opportunity for non-qm borrowers who closed on their higher interest rate loans last year to refinance to lower rate government and/or conventional loans

In this blog, we will discuss Mortgage Rates Outlook for 2019.

Mortgage Rates Outlook For 2019

Mortgage interest rates often fluctuate constantly. When rates are published, the rates are par rates for prime borrowers with 740 FICO or higher and 20% down payment. Par rates are the benchmark. The ultimate mortgage interest rates are determined by the overall risk factor of the borrower. These risk factors on each individual borrower are called Loan Level Pricing Adjustments (LLPA) or Pricing Adjustments.

Government Loans (FHA, VA, USDA) normally have lower rates than conventional loans due to the government guarantee. The government guarantee means less risk to lenders. Therefore, less risk means lower risk while higher risk by lenders means higher mortgage rates.

Predicting The Market

Nobody has a crystal ball and can predict what the outcome of rates will be in the future. However, with the FED’s announcing they will not be increasing interest rates this year, Mortgage Rates Outlook for 2019 looks promising. Rates have already dropped significantly so far this year. Many analysts and experts are predicting a promising 2019. Many borrowers who closed on their mortgage last year closed them at rates higher than 5.0%. Today, rates are hovering in the low 4.0’s. We are beginning to see a large increase in FHA and VA Streamline Refinances due to sharply lower rates. Low rates in 2019 mean more buying power to home buyers and big savings for homeowners thinking of refinancing.