Mortgage interest rates predictions are on the rise, because of a number of important economic pressures.
1. Mortgage Rates Predictions Rise Due To Rising Inflation
The rate of inflation is calculated into the interest rates charged for mortgages, credit cards, and other forms of lending. Rising oil prices, and the resulting rises in the price of transport, food, heating, and other necessities, will feed into a higher rate of inflation in the near future. This will put upward pressure on mortgage rates predictions.
2. Mortgage Rates Predictions Rise Due To The Falling US Dollar
As a result of the sub-prime crisis, which has now spread to the prime mortgage market due to excessive forced sales and falling property values, the entire US financial system is regarded by the rest of the world as unstable. This is resulting in a flight of capital from the US. The only way to entice capital to remain in the US, and thus halt the slide in the US dollar, is to pay a higher return, which means having a higher general interest rate within the US.
Until the US dollar stabilises, there will be significant upward pressure on mortgage interest rates predictions. Read the rest of this entry »
