Tuesday, January 26, 2010
Up, down, or flat? At the moment, rates are flat, as the market waits for the Fed's pronouncement on rates tomorrow at 2:15 EST.
The Federal Reserve is meeting today and tomorrow. Its December 16th press release included the following:
The anticipated expiration dates for the Term Asset-Backed Securities Loan Facility remain set at June 30, 2010, for loans backed by new-issue commercial mortgage-backed securities and March 31, 2010, for loans backed by all other types of collateral.
What that means, absent an infusion of new money by Congress to continue buying Mortgage Backed Securities (MBS), is that the Federal Reserve is almost at the end of its purchase cycle.
It will stop buying MBS, and if that happens, you can look for higher interest rates by as much as one full percentage point. If today's 30 year mortgage can be bought at 5%, you can expect 6% minimum for the second half of the year.
I'm Mike in Tucson, your preferred Tucson Mortgage lender.
Call me on my Blackberry (520) 349-9090
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