The average 30yr. fixed mortgage rate has moved from 3% in November to more than 5.0% today, a speedy climb but not unprecedented. Mortgage lenders are forced to secure forward contracts to hedge billions in mortgage funds in order to deliver rate locks to consumers. When the threat of rising rates becomes unavoidable, hedging costs soar and lift mortgage rates higher in the process. I’m hoping the financial markets become more comfortable with the prospects of future Federal Funds increases and mortgage rates can settle at this level thru the summer. If you’re waiting for rates to come back down to 2.75% you’ll need more than a comfortable chair and a cold beverage… you’ll need a time machine.
For tailored advice and the latest insights specific to your needs, don’t hesitate to contact Summit Mortgage. Summit can help you navigate your mortgage options and find the best fit for your financial future.