Interest Rates Predicted to Rise in 2011

Barring any big announcement from the Federal Reserve, rates on 30-year fixed–rate mortgages will climb to 5.1 percent by the end of 2011, the Mortgage Bankers Association predicts.

Jay Brinkmann, chief economist of the MBA, said he expects applications for mortgages to purchase homes to stay about the same as they were in 2009, higher than 2010, but refinances should drop.

Total mortgage volume is expected to be nearly $1 trillion in 2011, down from an anticipated $1.4 trillion this year and nearly $2 trillion in 2009.

Source: The Wall Street Journal, Amy Hoak (10/28/2010)

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