Mortgage rate hike in September?

[Svtkidd23]

Ok guys in I'm process of building my second house and will be going through m&t bank or navy federal.

I talked to the one lender and asked wether I should pay the deposit 1% and it locks my rate in and adds .15 to it. Also giving me a free one time use float down.

Meaning if rates go to 3.00 i can use my float down and lock it in there for 3.15 but if it climbs I leave it as is.


Why I am asking this is do you think in sept they are raising rates? Should I do the lock in now?

They are pouring the footers today so it's 6 months out or so till closing

Thanks guys

 

[ElscottHavoc]

Well, I don't foresee rates getting any lower. I imagine anyone taking on a variable rate (doesn't sound like your is variable, but just making thatvgeneral comment) interest rate without the means to pay it off very quickly is going to get burned. Just my opinion, but I personally wouldn't make any bets as to rates getting lower.

There's been talk of the Fed hiking rates for quite some time now. I don't think it's a matter of it but when and personally, based upon history, the eventual step of curbing inflation are masive rate hikes. I mean, wasn't it late 70s or 80s where 10% was average mortgage rate in an effort to impede inflation? Before my time...

 

[FIVEHOE]

What's the reasoning/logic behind thinking the rates are going to hike in september? (genuinely curious)

I'm personally at the point where I am ready to invest in a house, but I feel like a recession could hit us at any time (especially since the market usually tends to dip right around election time), which is why I've been holding back. Seems like the housing market in my area is more towards it's peak.

 

[ElscottHavoc]

Yellens been pretty dovish, so I'm not suggesting September is the month and it may not be.

That said, I personally feel like were on the brink of a large sell off in the equities and bond markets, especially if government starts scaling back quantative easing in a way that drives markets down. It could get sketchy.

I mean the official rate of Inflation is nearly zero currently, which I partially find hard to believe, but assuming things happen in cycles, well see inflation rate increase followed by rate increases.

 

[nxhappy]

if you are 6 months out until closing, I would lock in a rate right now while it's low.

 

[ElscottHavoc]

What's the current rate your be locked in at?

 

[OhIIICobra]

I enjoyed a nice mortgage rate jump from 3.15% to 4.5% in 2013 that came out of nowhere when I was building. Biggest jump in 26 years all within about 6 weeks. I would never advise waiting to lock.

 

[Svtkidd23]

What's the current rate your be locked in at?

4.15

 

[Svtkidd23]

http://www.cnbc.com/2015/08/05/feds-powell-nothing-decided-on-raising-rates-in-september.html

 

[DriftwoodSVT]

I really doubt it's going to go up next month. No reason for it.

 

[ElscottHavoc]

The fact they're throwing in a free float down with the initial rate lock and 1% deposit seems like a pretty good deal to.

Most the banks around here when I've looked around had wanted me to pay nearly an extra 2 points on deposits for a float down option.

Regardless of what occurs next month, a lot could happen in the following 5 months. I think 4.15% with a free float down is pretty good deal. I mean, if rates go up, you'll be happy you locked in. If rates go down significantly, you take your option to elect the new rate - but I'm pretty confident in the next 6 months to a year, rates aren't going to drop significantly. How long is your float down valid for us? Expiration for use?

 

[me32]

The last few years the rates where lowest in nov-dec. Not sure how fast or how long your waiting but its something to thing about. Nobody really know when rates go up or down. But i would go back an look what rates have been in September the last couple years to get an idea

 

[Svtkidd23]

The fact they're throwing in a free float down with the initial rate lock and 1% deposit seems like a pretty good deal to.

Most the banks around here when I've looked around had wanted me to pay nearly an extra 2 points on deposits for a float down option.

Regardless of what occurs next month, a lot could happen in the following 5 months. I think 4.15% with a free float down is pretty good deal. I mean, if rates go up, you'll be happy you locked in. If rates go down significantly, you take your option to elect the new rate - but I'm pretty confident in the next 6 months to a year, rates aren't going to drop significantly. How long is your float down valid for us? Expiration for use?

I think till closing

 

[Blackness03]

I was quoted 4.25 yesterday. I'll be watching this thread. I sure hope they don't go up that fast.

 

[rotor_powerd]

I'd lock in. Rates are only going to go up if they go anywhere. Seems like every quarter they say they will go up but so far nothing has really moved, I doubt that will last forever.

 

[4u 2 nv]

I just closed Last weeks and got locked in at 4% through my credit union. I've been home searching for 2-3 motnhs. When I started it was 3.75...and it's now 4.25%. I don't see it going down.

 

[tunedin302]

Here's my view having played this game 3 times now on 3 different home purchases over the course of 11 years. If you feel like you currently have a known good deal in your hands, take it and don't risk trying to get a somewhat better future deal. I think the risk is too high that your current deal won't be there in September, i.e. the potential little benefit (if any) to not locking is not worth the risk. I would lock now.

 

[SID297]

When the Fed starts raising rates get ready for another recession. It'll be another good time to buy assets on the cheap.

 

[FIVEHOE]

When the Fed starts raising rates get ready for another recession. It'll be another good time to buy assets on the cheap.

I can only hope. I've been saving my money for the past few years in anticipation for the next market crash.

 

[MG0h3]

Well, I don't foresee rates getting any lower. I imagine anyone taking on a variable rate (doesn't sound like your is variable, but just making thatvgeneral comment) interest rate without the means to pay it off very quickly is going to get burned. Just my opinion, but I personally wouldn't make any bets as to rates getting lower.

There's been talk of the Fed hiking rates for quite some time now. I don't think it's a matter of it but when and personally, based upon history, the eventual step of curbing inflation are masive rate hikes. I mean, wasn't it late 70s or 80s where 10% was average mortgage rate in an effort to impede inflation? Before my time...

Over 18%!! Can you believe that!! Good time to buy if you have cash though.