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发表于 2009-7-18 08:28
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ZT - TMG - Will 5-Year Mortgage Rates Fall Further?
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+ u5 X- v! Q* a' J* NBanks last raised mortgage rates on June 9, when the 5-year bond yield was at 2.68%.1 M$ b5 B! V: B0 K
5 r7 ~6 X5 f' w6 c% F4 f+ kSince then, the 5-year yield (which guides fixed mortgage pricing) has fallen to 2.44%, but bank rates have not budged.
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Y$ f; N' O4 ~) U8 ?BMO economist, Doug Porter, told the Toronto Star it's because banks "want to be convinced that it is not a flash in the pan and that any retreat in yields is sustained."
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! Z3 D& I/ N5 N1 ~He says: "I believe that we are probably not too far away from that point. It might take a little more of a deeper rally (in bond prices) to make it completely convincing."
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0 _% M$ _8 n9 f8 J$ K6 ]The often quoted CIBC economist, Benjamin Tal, thinks yields could fall another 0.05% to 0.10%, but any drop in fixed-rates will be short-lived. "By the end of the year, we'll start seeing rates rising," he says.
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7 K" N4 S, q9 _/ d, {# aIf rates do drop another 0.10%, it would translate into a $5.50 monthly payment savings for every $100,000 of mortgage. That's a total savings of $478 over five years, assuming a 25-year amortization and typical fixed rates., k9 d# \$ F& m2 k, q! u$ H$ ]/ g
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But remember, trying to time bond and mortgage rates is financially hazardous. While you're waiting, rates can move the wrong way-quickly. s. B, j" S$ ^/ r8 | _$ I
. q& K, @$ r+ y2 XYou're usually better served by focusing on factors that can dwarf a 0.10% rate savings, like finding a mortgage with the optimal term and just the right amount of flexibility (pre-payment options, openness, readvanceability, etc.). Too much flexibility is a waste, and too little can cost you in the long-run.
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6 i' J5 c* g1 z* lwww.happymortgages.com |
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楼主: 郭森房贷
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发表于 2009-6-24 17:04
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