If you’re in the market for a home loan, close the deal sooner rather than later. Mortgage rates, in particular, may start to go up soon. The Fed has been buying mortgage-backed securities, which has been holding rates down, but that program is set to expire at the end of March, although the program may be extended, it’s unclear at this point.
Does this mean you should rush into a decision? Of course not. But it does mean you can save a bundle by pulling the trigger on a home you’ve been considering since last year, particularly if you do it before April 30 and cash in on the tax credits available to first time home buyers as well as home sellers/buyer that have owned their home 5 years or longer.
When the economy is struggling, the Federal reserve cuts interest rates to boost activity. Rates are now at historic lows. This strategy works. The economy is beginning to expand, meaning unemployment should start easing and consumer spending should rise. Then interest rates will rise. The current expectation is that the Fed will start raising interest rates after March and into the third or fourth quarter.
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