How Will the Rise in Mortgage Rates Affect You?

Should you worry about the recent increase in interest rates? I’ll go over a few things you need to know today.

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Should you be worried about the rise in mortgage rates?  

The simple answer is no. Rates went from an all-time low of 3.5% to 4.2% fairly quickly. However, I would say that it’s a market reaction to how well the stock market has been doing lately and the new administration coming in, which has a lot of people optimistic about economic change.

If you look at the economy as a whole, you’ll see that the economy just can’t handle a huge rise in interest rates right now. So, interest rates will not go up to 6% or 7% this year. That may happen two or three years down the road, but you don’t have to worry about it right now.

The economy just can’t handle a huge increase in rates right now.

Over the next year, you should expect rates to hover around 4%. The business industry and nation as a whole would be crushed if rates went up significantly to 5% or 6%. If we see strong job creation, economic expansion, and increases in the GDP over the next year, then the Fed may have room to raise rates a bit more. However, rates will remain pretty low in 2017.

So, don’t worry too much about the rise in mortgage rates. If you have any other questions for me, please don’t hesitate to give me a call or send me an email. I would be happy to help you!