What happened to the rates?
Over the last two weeks you have probably heard about the stock market going crazy! One day a 900 point loss the next it rebounds. Well mortgage interest rates do not follow the stock market but they are affected by the bond market. As money is put into and taken out of the stock market many people move it into and out of the bond market causing huge swings. Two weeks ago we saw va interest rates of 5.875%. This week we have seen them at 6.5%. A change of just .5 percent can affect your mortgage by $100 or more!
Rates are not expected to remain high, in fact as we learn more about the $700B economic rescue plan, the markets will settle down as well as the bond market allowing interest rates to come back to 6% or less.
