2019 Idaho Real Estate Blog

Mortgage Rates Won't Stay Low For Long Main Boise Home Loans
Here are three factors you need to know about regarding why mortgage rates can't stay this low much longer...


Dear Reader:

If you're a homeowner that is considering a refinance, then It's probably the question at the front of your low can mortgage rates go? The short answer...they can't go much lower.

Here are the top three reasons you need to know about why mortgage rates won't stay low for long:

The End of the Fed Purchase Program is Near. The Fed has already announced that, by March of 2010, they will stop buying mortgage backed securities. The Fed has created an artificial demand for these securities by buying them at the pace they have. This demand has helped to create the lowest mortgage rates on record. When the Fed exits this purchase program, this lower demand will force mortgage rates to move up.

Rates are Artificially Low and Can't Really Go Lower. This is due to the excess demand from the Fed Purchase Progam that I just descibed above. I remember when customers told me they were "waiting to refinance until 30 year mortgage rates got to under 4.00%." That never happened, and never will.

Inflation Will Come in the Future. The thing to remember about inflation is that it erodes the future value of fixed-rate return instruments, like bonds. When investors begin to sell off bonds due to fears of inflation, our rates will undoubedly go up. Inflation will be coming in the next 6-24 is a matter of when, not if.

If you are interested in talking more about this post or a specific mortgage scenario, feel free to call me at (208) 880-0316, or email me at You can also visit my website at


Eric Leigh, Mortgage Consultant
2965 E. Tarpon Drive, Ste. 150
Meridian, ID 83642
(208) 880-0316
Posted by Eric Leigh at 10/7/2009 3:20:00 PM
Comments (2)
Re:Mortgage Rates Won't Stay Low For Long
Inflation will be coming in the next 6-24 is a matter of when, not if.

My bet is on defglation. The destruction of money is still much larger of a force then any printing the FED can do.

If salaries dont rise, If assets dont rise if credit continue to contract and consumer delerverages there will be no way to spark domestic driven inflation

And the world is still too USA demand driven to make up difference

We are converging on a day not so far off when EVERYTHING will fall, the system will clean the excess and we can then build a foundation for growth by 2020-25.
Posted by on 10/8/2009 2:40 AM
Re:Mortgage Rates Won't Stay Low For Long
OMG. I won't say that there is not some rationalization to all that but you sound like a conspiracy theorist.
Posted by on 10/8/2009 6:08 AM
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