Has the Tide Turned for Mortgage Rates?

From late April through the end of May, 30-year mortgage rates fell for five consecutive weeks. These lower rates created new opportunities to refinance -- and a natural tendency to wait to see just how low rates could go. By mid-June, however, it was clear that waiting to refinance can be a risky strategy.

Mortgage rates still down in 2014
Mortgage rates followed that string of falling for five consecutive weeks by rising in each of the first two weeks of June. However, this bump up in rates is still minor compared to how much they had fallen.

In all, by mid-June, 30-year fixed mortgage rates had fallen by 28 basis points so far in 2014, and by 38 basis points since the recent high reached last August. Those drops are big enough to make the difference in whether or not to refinance for some homeowners.

Of course, a further drop in rates would create an even bigger money-saving opportunity. However, recent news suggests it might not be wise to wait for another drop in rates.

The employment trend is good -- but it is bad for refinancing
In early June, the Bureau of Labor Statistics reported that 217,000 new jobs had been created during the month of May. This is 20,000 better than the monthly average for the past year -- and perhaps more significantly, it represented the fourth consecutive month in which job growth topped 200,000.

Employment growth has been up and down since the end of the Great Recession, so this recent stretch represents an unusually consistent period of strong job growth. That is welcome news for the US economy, but a stronger economy could also bring higher mortgage rates. This may be the wrong time to hold out for lower refinance rates.

Refinancing is a potential money-saving opportunity that cannot be guaranteed to last, or to come back again. Economic trends can change, but you can insulate yourself from changing trends if you lock in your opportunity to refinance.

This article Has the Tide Turned for Mortgage Rates? originally appeared on RefinancingRight.com

How to get even more income during retirement
Social Security plays a key role in your financial security, but it's not the only way to boost your retirement income. In our brand-new free report, our retirement experts give their insight on a simple strategy to take advantage of a little-known IRS rule that can help ensure a more comfortable retirement for you and your family. Click here to get your copy today.

You may also enjoy these mortgage-related articles:

Are you ready to refinance?

Shorter mortgages make sense in 2014

Inflation trend could push refinance rates higher


Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 3018022, ~/Articles/ArticleHandler.aspx, 9/21/2014 4:25:17 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement