Mortgage Rates To Rise?

While we wrapped up 2014 with mortgage rates at near historic lows (30 year fixed mortgage rates at 3.87%), things are almost certain to change soon. According to the Mortgage Bankers Association, mortgage rates should be around 5% by the end of 2015, and they aren’t alone in their thinking. The financial website Investopedia echos those predictions and recently had the following to say:

“Barring another financial and housing market implosion, and if the economy continues to improve, expect interest rates to rise in the latter half of 2015. If they do jump to the 5% range it will be a modest hike when compared to historical averages. Rates will still be far below the approximately 8.5% 30-year fixed-rates mortgages have averaged since 1971 when Freddie Mac started tracking them. Rates averaged 6% in the years leading up to the recession.”

Our friends at KCM have provided the following chart that lists the mortgage rate projections from the Mortgage Bankers Association, Freddie Mac, Fannie Mae and the National Association of Realtors: