Little Change Likely for Mortgage Rates

\r\nThe start of this week showed a consistent drop in mortgage rates as a result of the continued slowing of the housing market and a slower Fed survey. The drop in rates, though, is less than expected, leading analyst to forecast that rates will drop a little more, then stop. The 10-year note, and indicator of mortgage rate trends, fell below five percent this week, resulting in a drop of 30 year mortgage rates to less than 6.5%; the same rates had stayed just below 7% for months.\r\n

The classic pattern is indicating that the reduction in rate will stabilize in the near future, with the rate not going down too much more. Normally happening in cycles, the Federal Reserve points out that the market appears to be in stage two of four, leading them to believe the slow in rates will continue through the year, but that rates will not drastically fall in that time frame.\r\n