Zillow Advice: Lenders - 4% Fixed Rate Mortgages & Inflation - Will Banks Go Under?

I don't see 4% in our future, ...

Fri, 06 Mar 2009 02:30:00 GMT

I don't see 4% in our future, either, not for fixed rates.

You are seeing dips in the bond/treasuries, but trends are up, since December 2008.

Sure, other economies are much worse off than ours... so sovereign funds are still buying Treasuries, as a hedge against their own local inflation.

But once the Stock Market starts to rebound... you better already have your loan application submitted, appraisal done, and your rate locked!

4.5% - 5% will be in the rear-view mirror, as bond/treasury prices drop (yields rise) to attract continued investment in treasuries. Mortgage interest rates will have to go up, as a result.

Then the topic will be changing to higher rates and higher inflation...

If you are thinking about refinancing, stop thinking about it and get it done, before it's too late, for those of you who are lucky enough to have a stable job, equity, and a high enough credit score!

Good luck to you all!

I don't see us getting to ...

Thu, 26 Feb 2009 17:17:00 GMT

I don't see us getting to 4%. The data I have been looking at indicates the market is starting to flatten, so I expect a rebound soon.

Tom Ashworth Real Estate
http://www.tomashworthrealestate.com
tom@tomashworthrealestate.com
208-830-7991

fannie and freddie are already ...

Fri, 13 Feb 2009 22:58:00 GMT

fannie and freddie are already insolvent. Now they are being asked to:
1. workout by reducing payments/principal all of the bad loans to stop foreclosures. yep, write those balances down to 50% or so... should help that balance sheet a ton!

2. keep rates as low as possible to encourage buying. yeah, nothing like buying up a trillion or so dollars of low interest fixed rate loans. No inflation risk in that investment!

3. delay foreclosures with moratoriums. If we are really nice to mr 100% upside down owner, maybe he will be nice back and start paying on his mortgage! oh rats, he heard about the 50% off plan in #1!!

4. let renters stay in foreclosed properties. I'm reasonably sure an inept government beurocracy can do a fantastic job of managing rental property! After all, landlording is easy! everybody always pays the rent early, never damages the home, or needs evicted. remodelling afterwards is hardly ever necessary either, and can be handled by a washington government employee very efficiently!!!!

The red ink will flow in like a f***ing tsunami before this is over. Since these are all quasi government debt, expect the US credit rating to take a dive, and all interest rates to go very high sometime in the future. T-bills are the last bubble before they all die.

Vast majority of loans are ...

Fri, 13 Feb 2009 22:38:00 GMT

Vast majority of loans are being sold to the FED through FHA and Fannie/Freddie. These loans wont be on the banks books...

I wouldn't bet a penny that ...

Fri, 13 Feb 2009 22:30:00 GMT

I wouldn't bet a penny that we go to 4%.