|
Shopping
Around/Trying
to Predict Future Interest Rates
HERE’S THE INSIDE SCOOP ON HOW TO
DO IT RIGHT!
First: make sure you are working with an experienced,
professional loan officer. The largest financial transaction of
your life is far too important to place into the hands of
someone who is not capable of advising you properly and
troubleshooting the issues that may arise along the way. But how
can you tell?
Here are FOUR SIMPLE QUESTIONS YOUR LENDER ABSOLUTELY MUST BE
ABLE TO ANSWER CORRECTLY. IF THEY DO NOT KNOW THE ANSWERS… RUN…
DON’T WALK… RUN… TO A LENDER THAT DOES!
-
What are mortgage interest rates based on?
(The only correct answer is Mortgage Backed Securities or
Mortgage Bonds, NOT the 10-year Treasury Note. While the 10-year
Treasury Note sometimes trends in the same direction as Mortgage
Bonds, it is not unusual to see them move in completely opposite
directions. DO NOT work with a lender who has their eyes on the
wrong indicators.)
-
What is the next Economic Report or event that could cause
interest rate movement?
(A professional lender will have this at their fingertips. For
an up-to-date calendar of weekly economic reports and events
that may cause rates to fluctuate, click here.
-
When Greenspan and the Fed “change rates”, what does this mean…
and what impact does this have on mortgage interest rates?
(The answer may surprise you. When the Fed makes a move, they
are changing a rate called the “Fed Funds Rate”. This is a very
short-term rate that impacts credit cards, credit lines, auto
loans and the like. Mortgage rates most often will actually
move in the opposite direction as the Fed change, due to the
dynamics within the financial markets. For more information and
explanation, just give us a call)
-
What is happening in the market today and what do you see in the
near future?
(If a lender cannot explain how Mortgage Bonds and interest
rates are moving at the present time, as well as what is coming
up in the near future, you are talking with someone who is still
reading last week’s newspaper, and probably not a
professional with whom to entrust your home mortgage financing.)
Be
smart... Ask questions… Get answers!
More than likely,
this is one of the largest and most important financial
transactions you will ever make. You might do this only four or
five times in your entire life… but we do this every single day.
It’s your home and your future. It’s our profession and our
passion. We're ready to work for your best interest.
|
