Mortgage Rates at the Low Point

Kiplinger.com (04/21/08); Idaszak, Jerome
Mortgage rates currently sit at 5.88 percent, and analysts say they are unlikely to fall any further for the rest of the year. Interest on 30-year fixed loans is only down a quarter of a point, as the credit markets have cut the link between it and yields on 10-year Treasuries; and while skittish investors have moved to Treasuries to trim the yields, mortgage lenders have not eased lending standards. Mortgage rates are likely to close 2008 at about 6 percent as investors in bonds focus on rising inflation and drive interest rates higher. Long-term rates will also increase due to the additional supply of Treasuries as Congress borrows to raise money for the growing federal budget deficit.