Across the country, mortgage rates rose toward the end of January, from an average of 4.89% for 30-yr fixed loans in early January to rates averaging 5.24% in the latter part of January. This rise in mortgage interest rates caused a significant decrease in mortgage loan application volume, especially in the refinance sector of Dallas.

Although the government would like to see mortgage rates continue to remain low to revitalize the housing market, primarily Dallas’ mortgage rates, some of their efforts may be having the opposite effect. According to a recent USA Today article, the yields on 10-yr Treasury notes are actually rising due to the increase in government borrowing. This in turn is causing mortgage interest rates to rise, especially in Dallas.

So what happens to mortgage interest rates in Dallas in the near future? A recent survey conducted by Mortgage-X.com suggests that mortgage rates are likely to fall slightly in the next 30-90 days. The survey polls over 250 mortgage rate experts, and currently, about 64% of the participating mortgage professionals believe mortgage rates will decline slightly over the next 30 days and 43% believe mortgage rates will decline slightly over the next 90 days.

Mortgage rates could see some government assistance in the near future. The Senate will debate the stimulus bill this week, and there are several mortgage related ideas that are being put forth. First, there is a Republican proposal that would encourage lenders to offer a 4% fixed rate 30-yr mortgage. The government would guarantee the mortgage rate for some period of years so that if prevailing rates were at 5.25%, the government would make up the difference. More detail can be found in this CNN/Money Magazine Story.

First time home buyers in Dallas might also see assistance in the form of an income tax credit. Business Week Reports that as the stimulus bill moved through the House of Representatives last week, there was a proposal for a tax credit of $7,500 for first time home buyers who act in the first half of this year. The Construction Industry lobby is pushing to have this proposal increased in both dollar amount and time offered, as construction spending is seeing record declines.

So while the economic news might be grim for a lot of the country, those who are able to qualify for loans may just find that this is a great time to be buying a home, especially in Dallas- looks as if a great deal of assistance will arrive in the very near future.

Posted on Tuesday, February 3rd, 2009 at 11:56 am and is filed under Mortgage Rates. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.