Mortgage interest rates predictions for 2013 say that, while the mortgage rates will remain low throughout the year, they will be higher at the end of 2013 than at the beginning of 2013. The same mortgage interest rates forecast was made for the last two years, as well, but it turned out to be wrong. Mortgage rates kept dropping and they are near historic lows right now, so it’s hard to see them dropping even further. For now, the Federal Reserve is doing its best to keep mortgage rates low by buying billions worth of Treasuries and mortgage-backed securities.
Some predictions say that the mortgage interest rates will be around 3.8 percent by the end of the year, while others say that they will grow up to 4.4 percent. Most predictions agree that the rates will remain below 4% during the first half of 2013, but, if the unemployment rate falls to 6.5 percent, the Federal Reserve will decide to stop buying bonds, which will cause the mortgage interest rates to grow.
Should You Trust the Mortgage Interest Rates Forecasts?
Mortgage interest rates are hard to predict. Some people use historical data to come up with a forecast, carefully analyzing previous interest rates trends. Others look at the current economic climate or any upcoming major changes that may have something to do with mortgage rates, while others make predictions based on instinct.
Mortgage rates can never be predicted in absolute terms. It is entirely up to you whether you believe a mortgage interest rates forecast or not, but the most important thing is to understand that these predictions can give you a ballpark figure as to where mortgage loan rates are going.
Just by looking at mortgage interest charts for the past few months, you could get a general idea of the direction in which mortgage rates are going. Mortgage interest rates don’t fluctuate dramatically and most people pay attention to even the smallest interest rate fluctuation. Because mortgage loans extend over long periods of time, even the smallest drop could save money over time.
Predictions made by a bank representative should be taken with a grain of salt, as the bank employee’s job is to convince you to borrow money from them. You also shouldn’t trust alarmist ads in newspapers or on TV. Those types of ads are designed only to get you to borrow money.
Tips to Help with Your Mortgage Decisions
Buying a house or refinancing a mortgage is a decision that involves several factors, not just mortgage interest rates. Your credit score and your financial situation also influence how much you’re going to pay and if it’s really the time to be taking this step. Here are a few tips that will help with your mortgage decisions in 2013:
- Mortgage interest rates are low right now, so, if your financial situation is in order, it might be the time to take out a mortgage loan. Also, if you haven’t refinanced lately, you’re probably paying a higher interest rate than if you would refinance right now.
- Don’t forget that there’s an alternative to conventional loans. Federal Housing Administration(FHA) loans allow you to buy a loan with as little as 3.5 percent down.
- Make sure you have a good credit score. Having a credit score of over 720 is perfect for taking out a loan and receiving the best interest rates.
- Shop around. Even if mortgage loan rates are very low right now, you should get quotes from several lenders and carefully compare them.
In conclusion, using a mortgage interest rates forecast is ultimately up to you. Most interest rates predictions are available to everyone, but always pay extra attention to the source of these predictions. These forecasts are nothing more than guesses, so they shouldn’t be the only factor in deciding whether to take out a mortgage loan or not.