Hopefully, that famous line from the 1967 movie Cool Hand Luke won't apply to our leaders on Capitol Hill, as they work toward a resolution on the debt ceiling debate and budget fight. Read on to learn what this could mean for home loan rates.Congress continues to debate whether to raise the debt ceiling, which is now at $16.7 trillion. Although the debt limit deadline is today, the Treasury Department has said that it has enough funding to operate as usual until
The uncertainty over these issues helped Mortgage Bonds improve, as investors moved their money to safer investments like Bonds as they often do in times of uncertainty. Since home loan rates are tied to Mortgage Bonds, this also helped home loan rates improve last week.
In housing news, Case Shiller reported that its 20-City Home Price Index for July rose by 12.4 percent compared to July 2012. This is the fastest annual pace since 2006. However, from June to July there was only a 1.8 percent increase, which is the smallest monthly gain since March, as 15 of the 20 cities saw slower growth. This slowdown can be attributed to the rise in home loan rates over the past few months. New Home Sales did increase by nearly 8 percent in August from July.
Also of note, the government reported that the final reading on Q2 Gross Domestic Product was in line at 2.5 percent and unchanged from the second reading. Inflation as measured by Personal Consumption Expenditures remained tame in August while Personal Incomes and Spending were in line with estimates. These readings give the Fed cover to continue its Bond purchase program known as Quantitative Easing, which has helped home loan rates remain attractive.
The bottom line is that home loan rates remain attractive compared to historical levels and now remains a great time to consider a home purchase or refinance. Let me know if I can answer any questions at all for you or your clients.. Failure to raise the debt limit by would most likely lead to an unprecedented default on the United States' bills. And of course, since no deal was met, we have a partial government shutdown
We would love the opportunity to help you manage your Lake of the Ozarks Mortgage Loan or refinance. Give me a call at (573) 746-7211 or send me an email at firstname.lastname@example.org with any questions you may have!!
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Sr. Residential Mortgage Lender
2265 Bagnell Dam Blvd, Suite B
PO Box 1449
Lake Ozark, MO 65049
Direct: (573) 746-7211
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