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[icon] Predict the future again? - Patti
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Subject:Predict the future again?
Time:10:16 am
It's redux day here at the old blog de Patti. A little while ago I asked people to predict whether mortgage rates would drop again. As expected by all, they have-- my current lender has 30-year fixed loans at 5.5%.

Is it time to jump on it?
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prock
Link:(Link)
Time:2008-03-20 05:53 pm (UTC)
I would guess no.

It seems that the fed is in the process of debasing mortgage rates to minimize the pain caused by the coming ARM adjustments. My guess is sometime this summer you'll get a better rate.

But then, I though the world wide web was vastly inferrior to ftp.
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gunga_galunga
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Time:2008-03-20 09:58 pm (UTC)
But then, I though the world wide web was vastly inferrior to ftp.

To say nothing of gopher.
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luckylefty
Link:(Link)
Time:2008-03-20 05:56 pm (UTC)
I would jump on it. It will probably go a little lower, so betting that it will go lower will probably win. But it will only go a little lower, and could easily end up a lot higher, so I think it's smarter to get the mortgage now because of the risk/reward ratio.
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dmorr
Link:(Link)
Time:2008-03-20 05:58 pm (UTC)
You can somewhat hedge by refi'ing now planning to do it again if rates drop enough. If they only drop a little then you got a good rate so you're fine; if they drop a lot then you refi again and you lost some money. But if they go up then you saved a bundle. So this might be pretty cheap insurance against rates rebounding.

I think market timing is really hard and generally try to avoid it.
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bittercrackbaby
Link:(Link)
Time:2008-03-20 06:15 pm (UTC)
I would think that there might be another silly rate cut coming, plus there's the new 'jumbo conforming' tier coming.

I'm waiting, but I'm at 4.125% for the next year. Worst case 6.125% in 2009.
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dmorr
Link:(Link)
Time:2008-03-20 06:19 pm (UTC)
The jumbo thing has already happened, right? It was retroactive to the beginning of the year.

There are probably more fed rate cuts coming, but you never know, and anyway those are only weakly correlated with mortgage rates.
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bittercrackbaby
Link:(Link)
Time:2008-03-20 08:39 pm (UTC)
The "jumbo conforming" loan, which is $417k to $729k is only applied to high cost markets with loans originating between 7/1 and 12/31 of this year.

I believe it has to be a first mortgage single owner occupied detached units with a puny cashout cap.
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whipartist
Link:(Link)
Time:2008-03-20 08:47 pm (UTC)
My mortgage is under $300K, so the jumbo thing doesn't matter to me. I think I may call my bank and see if they have a quick-and-dirty refi available.
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bittercrackbaby
Link:(Link)
Time:2008-03-20 09:12 pm (UTC)
I've seen rates for conforming 30 year loans fluctuate from 5.75% to 6.375% back to 5.625% in the course of the last 2 weeks. Last year as the subprimes melted it seemed to hover around 6%.

If you can find a ~5.5-5.75% 30 year without prepayment penalties and points, I'd say try to lock that rate in. There's a possibility it may touch 5.25%, but that's chump change at that point.
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mspurrmeow
Link:(Link)
Time:2008-03-20 05:59 pm (UTC)
While gambling and waiting for a lower rate would well... maybe net you a Jackpot rate, 5.5 is pretty awesome. How much of a gambler do you want to be today? I think that pretty much sums it up.

But, yeah, I think they'll drop just a bit more. Not sure if I'd wait, though. I wouldn't expect the Post-9/11 4's, though.
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songmonk
Link:(Link)
Time:2008-03-20 10:51 pm (UTC)
I figure you must have said so, but I don't see it: what is your current rate?
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[icon] Predict the future again? - Patti
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