Right now is an opportune time to consider the benefits of a refinance or purchase of a new property. With the recent decreases in oil prices during the Thanksgiving holiday shortened week, mortgage rates remain near the low for 2014 as the influence of historically low oil prices is felt. The short term forecast for continued low prices at the pump were solidified when OPEC leaders voted to keep production levels constant last Friday.
The drop in oil prices has a very strong muting effect on inflation, which is a primary driver of interest rates. With very little fear of near term inflation, there is no need for the Fed to change short term benchmark interest rates. This situation is very supportive of continued mortgage rates levels we are seeing now. The longer term effect is less clear, as many feel the savings at the pump will spur a solid increase in consumer spending. Consumer spending drives the economy and could lead to greater demand for goods, services, and jobs. This result will move rates upward as inflation creeps back into the picture.
Stay tuned for more industry updates! With the ever changing economy and mortgage rates, be sure to stay up to date on all mortgage industry news. If you are ready to refinance or purchase a new property, give us a call and we can help you get started – 952-920-5100.