Interest Rates on the Upswing

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By Steve Cline, Preferred Financial

It’s true that after enjoying historically low mortgage interest rates for the last couple of years, today’s rates are on the upswing. As you are most likely aware, the 10 Year Treasury bond is the benchmark that relates to what the mortgage interest rate will be at any given time. It is the most liquid and widely traded bond in the world and a safe-haven for most countries’, businesses’ and individuals’ money. During the last 3 decades, its yield has been as high as almost 16% and as low as about 1.5%, currently hovering at about 2.7%. The long- term average is 6.3%.

Putting this into perspective, we are still only about a percentage point from the lowest 10 year Treasury yield in history, and, consequently, the lowest residential interest rates in history.

Given that the new Fannie Mae and Freddie Mac conforming limits have been raised to $484,350 (conforming) and $726,525 (high-balance), plus the Fed’s forecast to raise its rate at least 2 more times in 2019, the time to take advantage of current loan programs and improve your financial well-being is now. If you need to do something (refinance, purchase, cash out or pay off existing equity lines of credit), getting started sooner rather than later is advisable. As the year progresses, we will almost certainly see interest rates continue to rise.

Steve Cline Mortgage Broker and Insurance Broker

Office phone - (925) 820 - 5557

Email - SCline@PreferredFinancial.com

Website - www.PreferredFinancial.com