The government shut down caused momentary turmoil in the mortgage world. Not only was the IRS unable to do its part to allow lenders to distribute loans, consumers were wary of beginning the application process. Now that the government is back in business, conditions seem to be changing for the better.
There are several immediate consequences of this change. First, home builders will be able to resume construction and preparations for construction with renewed confidence. Second, homeowners who were seeking government backed loans are able to continue the finance process.
However, the true import rests not in business returning to usual, but rather in the changes. Mortgage backed securities have risen significantly over the past week, and with employment figure is not as strong nationally as anticipated, this rise may continue. This trend indicates that soon mortgage rates are likely to fall, and we have, in fact, seen some small reduction in rates in many areas already. Falling mortgage rates should encourage more consumers to begin or continue the home application process.
This trend is sure to be bolstered by the fact that the Federal government is committed to tapering off its involvement in bond buying. Though it is unclear when exactly this will occur, when it does, mortgage rates are likely to rise.
Leverage these indicators by encouraging buyers to pursue new loans or owners to consider refinancing. With mortgage rates still low, but with key indicators signaling a potential increase, it is easier than ever to demonstrate the need for urgency.
Fidelity National Title - Idaho 