Bogleheads

[scraig]

All of the financial media today predicts that the Fed will lower the rate again at the end of January. To me this means that mortgage rates will go down in the near future and I should wait - at least until the end of the month - to refinance.

Surprisingly, my mortgage person has advised me to refinance now at the current rate. While I trust his advice, it makes absoultly no sense to me. Could he be trying to lock me into a slightly higher rate?

I'd really appreciate it if someone more more familiar with rates and mortgages could give me some general guidance on this.

Thanks in advance.
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"Up again?! This is incredible. I'm.. I'm getting it."
- George Costanza ("The Stock Tip")

[Parrot Head]

The Fed meeting later this month will be discussing the reduction of the short term rates.

Most fixed rate mortgage rates follow the ups and down of the 10 year treasury rates

The Fed meeting, although it may have an impact on the mortgage rates, they do not go hand in hand.
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"I don't mind coming to work, but that eight hour wait to go home is nonsense."

[stratton]

[GIS Guy]

Hi,

I am in the application phase of refinancing.

Nobody can predict what will happen with mortgage rates.

Indexes upon which ARMs are based on are more influenced by the Fed cuts, however the fixed rates are not so much.

I was told that in the past, the 30 yr fixed which I am applying for right now, is more influenced by the stock and bond maket. In the past, but not so much in recent past, the 30 yr fixed correlated well with the 10 yr Treasurey Note http://finance.yahoo.com/q/bc?....q=l&c=

In short, what will happen in the next 30, 60, or 90 days with the 30 yr fixed rates, nobody knows. But we all know they are near their record lows and you can't get much better than this (scroll down to the graphs at the bottom and look at that!) http://www.mortgage-x.com/trends.htm

The way I see it, the rates are likely to go down maybe a tad more in the short-term, but there is (from what I've researched) a chance in response to the market and inflation data we could see a huge jump all of a sudden in the 30 yr fixed rate.

Do you want an ARM or Fixed? I just locked in an 80% loan to value 30 yr. fixed cash-out refinance with a rate of 5.69%, and APR of 5.73% at Wachovia. If you are able to refi with no cash-out (they considered mine a cash-out because I am refinancing a mortgage AND equity credit balance) AND have a LOWER loan to value ratio, you can get a much lower rate at 5.5% give or take a little. I jumped on it because some inflation data could come back or the market could flip on a dime and the rates may jump back up to 6.5% overnight...no idea and impossible to predict.

Good luck,
GIS

[scraig]

Thanks to everyone for the helpful info.
_________________
"Up again?! This is incredible. I'm.. I'm getting it."
- George Costanza ("The Stock Tip")