WHEN OIL GOES UP, KEEP AN EYE ON MORTGAGE RATES
March 29th, 2009 categories: Buyer Strategies, Mortgage & Finance
Here is a “heads-up” for home buyers and home owners considering refinancing.
Are rising oil prices your sign that mortgage interest rates are headed up?
There are a number of factors at play that have pushed crude oil past the $50 mark for the first time in 4 months, and these forces may also cause mortgage rates to rise.
For example, on March 18, the Fed pledged an additional $1.15 trillion to support the economy.
Is this part of a Federal Reserve strategy to intentionally trigger inflation? The Fed’s total debt purchases now total $1.75 trillion.
To finance its commitments, the Federal Reserve is cranking up the printing presses. New money is on the way, along with a devalued dollar.. This moves us toward inflation which in turn contributes to rising oil prices, and very possibly higher interest rates on mortgages.
Nobody can plan a home purchase or a refinance around a set of possibilities, but these conditions are worth keeping an eye on.
(Image courtesy: The Wall Street Journal)
