Mortgage rates today are low and are expected to stay low into the future because of world economic risks. The economy in the U.S. hasn’t fully recovered yet and unemployment is still high which is forcing the Fed’s hand at keeping current mortgage rates low.
Mounting debt troubles in countries in the European Union is also keeping today’s refinance rates in the U.S. low. To figure out how much your monthly mortgage payments will come to use a mortgagecalculatorwithtaxes and you can calculate the cost down to the penny. Stock prices in the U.S. took a steep dive on Monday after warnings continue to come out about the finances of several European countries. Investors are concerned that Europe’s debt crisis is worsening as a result the Euro hit a low against the dollar that hasn’t seen in two months.
The Euro is trading at $1.39, the lowest point against the dollar since March. Inflation in Great Britain is also a concern, recent inflation numbers were at 4.5% the highest number in 3 years. If England increases interest rates you can expect the dollar and Pound to increase more against the euro.
The world economy recovery isn’t on solid ground. If the European debt crisis continues and spreads to other countries you can expect investors to flee the Euro and European bonds. The only viable alternative will be U.S bonds. As investors by bonds prices to higher and yields go lower. As bond yields go lower mortgage rates follow lower as well since rates are pegged to bond yields.