Mortgage Rates — Near Record Low — But won't last long

WASHINGTON – Sept. 11, 2009 – Rates for 30-year home loans ticked down for the second-straight week, remaining close to record lows reached over the spring.



The average rate for a 30-year fixed mortgage was 5.07 percent this week, down from 5.08 percent a week earlier, mortgage company Freddie Mac said Thursday. Rates, while above the record low of 4.78 percent hit in the spring, are still at attractive levels for people looking to buy a home or refinance.



Rates should stay low for another month or two as government efforts to keep them low remain effective, predicts Michael Larson, an interest rate and real estate analyst with Weiss Research.



But it won’t last forever. Rates will eventually trend upward, Larson said, as the economy starts to turn around and concerns return about how long overseas investors can stomach massive levels of U.S. debt.



“Over the longer-term, there’s going to be general upward pressure on interest rates across the spectrum,” he said. “Mortgage rates will be caught up in that.”

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