Market Conditions

First, thanks to everyone who supports Covenant Mortgage - your partnership with us by allowing us to serve your mortgage needs or by telling friends and family is appreciated.

I recently returned from a missions trip to China and one of the things I realized is how blessed we are in America regarding our housing opportunities. The housing market in our area continues to be mildly volatile but there are still many great opportunities to be a homeowner; so if you are thinking of purchasing a home, now is the time to act.

Rates continue to remain pretty constant with average 30 year fixed rates hovering in the mid six's. One common misconception is that all mortgage rates move in direct correlation to the moves the Federal Reserve make - i.e. if the Fed lowers rates by .50(like they did a few weeks ago), then mortgage rates should be a .5 lower. The Fed controls the discount rate and the federal funds rate which ultimately influences the prime rate so the good news if you have a HELOC(home equity line of credit) is that you should see that rate going down next month. However, most mortgage rates are tied to the broader markets and typically follow the price/rate of the 10 year treasury's - bottom line -mortgage rates will probably hold pretty constant or move slightly lower over the next year; even in spite of what moves the Fed may make.

If you would like more info on rates, send me an email or post a comment.

Rich