Feds Sneezed and What Happens the Mortgage Loan Applications and Real Estate Sales Slow Down - I'm Hearing that Rates Might Decrease Before they Rise for Good!

Feds Sneezed and What Happens the Mortgage Loan Applications and Real Estate Sales Slow Down - I'm Hearing that Rates Might Decrease Before they Rise for Good!

Despite purchase loan applications increasing 2% last week, mortgage applications fell for the week. Why you ask?

First, refinance applications fell 5% for the week. Despite the 2% increase in purchase mortgage applications, the 5% decrease in refinance application had a major impact because nearly 67% of mortgage applications are refinances. In case you are wondering why the large decrease in refinance mortgage applications last week, here is why.

The Fed hinted while they sneezed and said that they may intervene less in the mortgage-bond market. Once they hinted this, mortgage interest rates increased nearly 1%. The Fed interventions has actually artificially lowered the mortgage interest rates.

So what is happening this week? According to the loan officers I have talked to, they are busy working on older transactions. The steady steam of new transactions has slowed to a snails pace this week. Most loan officers are thinking that interest rates will decrease for a little bit before mortgage rates start to rise for good this fall.

So why should you care and what does this mean to the normal Kansas City Home Buyer? If mortgage rates increased from 3.5% to the predicted 5.5% this fall on a $200,000 mortgage, your mortgage will be nearly $240 more a month. I don't know about you, but $240 a month is a lot of money. You can nearly finance a car for $240 a month, buy a boat, pay for the kids braces or plan a vacation. In other cases, homeowners can finance the loss they may have on their current home so they can relocate to another city or buy a bigger home.

Even if you don't plan on refinancing or buying a home this will still affect you because I'm sure there is a few neighbors in your subdivision who do plan on refinancing or relocating. Keeping home values in the neighborhood is a Win-Win!

Thinking of buying a home in Kansas City? This maybe your last chance to capture a good deal on a home at an incredible interest rate.

Let's talk about some of the bargains I have been finding lately.

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