Interest Rates and Fed

Interest rates on 30 year mortgages are starting to rise.  If we look at recent history, we find that when rates bounce off the floor, they rise quickly and dramatically.  Since October 2008, rates had fallen a full two points on both conventional and FHA loan products.  It is not unreasonable to suggest, based on the past that rates will return to the October numbers.  But even if they only come back 50%, we are looking at a full point increase.  The government has been artificially keeping rates down for over a year in hopes of stimulating the US housing market.  Do they have the appetite to continue while being faced with so many other challenges?  If so, do they have the financial resources? Only time will tell!

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