What To Expect For NH Mortgage Rates This Year Roger Odoardi NH Mortgage Rates Expected to Follow National Trend The year ahead in New Hampshire in terms of mortgage rates looks to be an interesting one to say the least. Similar to the rest of the nation, NH mortgage rates could be on the upswing after a few great years of historic lows. Opinions, however, vary as to just how much of an increase will actually occur. While the average rate for a 30-year fixed-rate mortgage has fluctuated between just above 4% and 4.5% for most of 2014, let’s take a look at what insiders think will happen with long term rates in 2015: Industry experts with the Mortgage Bankers Association indicated in a recent report that 30-year rates will rise to 5% by the end of 2015. The MBA report suggests the rates will not rise until sometime later this year—possibly June or July. Meanwhile, Freddie Mac’s chief economist Frank Nofthaft has indicated that he expects interest rates to climb throughout 2015. Nofthaft has 30-year mortgages topping out at 4.6% rather than the 5% predicted by the MBA. Bill Conerly, an industry expert and contributor to Forbes, believes the long-term rates are likely to go higher thanks to “global long-term economic growth.” Conerly suggested as early as last August that the rates will go up to nearly 6% by the end of 2015. Why the increase? Ultimately whatever ends up happening with NH mortgage rates is heavily tied to what happens nationally. This is because the Federal Reserve, the central bank of the United States known as “The Fed,” has indicated that it will allow mortgages rates to drift up in the coming year after having held down both short- and long-term interest rates since around 2008. In order to maintain a healthy economy, the Fed might decide to lower interest rates in an effort to make money more available to businesses, homebuyers and consumers. However if the economy is “heating up,” similar to how it is looking these days, the Fed might raise interest rates to help slow things down a bit. While this helps us understand the fluctuations at a basic level, it’s actually much more complicated than that, as mortgage rates are truly determined by a number of factors tied to the economy, such as the debt markets and Federal Reserve policy. So as you can see, the general consensus is that industry economists expect mortgage rates to climb—most of them in agreement that rates will reach close to or above 5% by year’s end. There is, however, reason to be optimistic about the news. Rates are still expected to be much lower compared to historical standards and, if anything, the fact that rates could begin to rise by mid-summer means NOW may be the best time to enter the housing market or refinance at a lower rate. One thing to look forward to in 2015 is the recent news that the Federal Housing Administration would be reducing annual mortgage insurance premiums for FHA-backed loans—making it the first reduction after several increases that followed the housing bubble crash. The reduction, which will go from 1.35% to .85%, will apply to FHA loans issued on or after January 26. At Blue Water Mortgage Corporation, we strive to provide our clients with all of the latest industry news, as well as home buying and selling tips. Our tools, tips & resources page features a little bit of everything to help you get started—whether you’re a first time homebuyer looking to secure a home mortgage loan or a seasoned homeowner looking to refinance their mortgage. Contact us today! Roger Odoardi Roger is an owner and licensed Loan Officer at Blue Water Mortgage. He graduated from the University of New Hampshire’s Whittemore School of Business and has been a leader in the mortgage industry for over 20 years. Roger has personally originated over 2500 residential loans and is considered to be in the top 1% of NH Loan Officers by leading national lender United Wholesale Mortgage.