As we dive in headfirst into the 4th quarter of 2016, we are presented with a few unique events coming up that could affect the mortgage rates we are seeing. The first meeting on the agenda is the Federal Reserve Meeting which is scheduled for the first week of November. Then right after that we have the presidential election slated for November 8th, or a week after the Fed meeting. With 2 very important events going on, one has to wonder the impact that these events will have on interest rates for mortgages. Now we can all only make educated guesses as we can’t predict the future, but if you ever have a question regarding Mortgage Rates And Election Year or a future mortgage, you need to call me at 888-900-1020.
When the Federal Reserve meeting takes place, the items on the agenda are normally economic-based and they will determine how our economy as a whole is projecting and what the outlook for the economy may be. If you were to take analysts’ predictions from last year with regards to 2016, most assumptions would have been untrue as the Fed has not increased interest rates much this year keeping the fed rate near a historic low at .50%. Now, what does this mean you may ask, well this means that access to money backed by the government can be had extremely cheaply and this in turn correlates to lower borrowing rates that can be offered to us as the consumers. With average interest rates hovering around 4% this is directly related to banks and lending institutions having access to “cheap” money. As an example, the fed rate was at or around 6% back in 2000 and average interest rates for mortgages were above 8%. So if you are in the process of going through the mortgage process and you hear that the feds may actually be raising rates in November or by the end of the year, then maybe it is time to lock your rate now because even if the Fed Rate is increased to .75% you can guarantee mortgage rates will increase between .25%-.50%.
As we look into Mortgage Rates And Election Year variables, it is a smart exercise to look into the history of election years and what the mortgage rates did leading up to and after the election. When you look at the last 20 years or 5 election cycles you will see that the lead up to the election and after, rates were holding steady or decreasing, however, there isn’t a definitive correlation between these results and the elections. If you are looking for Mortgage Rates And Election Year answers, there might not be an answer here at all, but instead as with everything, the economy and the world in totality have a lot to do with it. From the last two election years in 2008 and 2012, you could assume Mortgage Rates And Election Year caused rates to decrease, but if you just think what was happening at the time, the market was in the middle of tanking or at a point where it wasn’t on the way back yet, so yes, rates were falling, but this was due to economic factors and not Mortgage Rates And Election Year correlation. As much as I’d like to find a correlation between the two, I just don’t think there is one. When it comes down to it, you should still work with and trust your mortgage professional like myself to give you the guidance needed to make the soundest decision. Given this, please visit my websites to get started or get in touch with me. To get your mortgage application started. If you need me, call or text me any time at 888-900-1020. I look forward to helping you today!