Mortgage interest rates are expected to remain high in 2020, according to experts. The high rates have been largely attributed to the uncertainty in the global economy, as well as the US Federal Reserve’s decision to keep interest rates low.
Uncertain Global Economy
The global economy has been experiencing turbulence in recent years due to a variety of factors, including the US-China trade war, Brexit, and the coronavirus pandemic. With so much uncertainty, investors have become increasingly cautious, resulting in higher mortgage interest rates.
Federal Reserve’s Decision
The US Federal Reserve’s decision to keep interest rates low has also played a role in the high mortgage rates. This decision was made to help stimulate the economy and encourage lending. However, it has had the unintended consequence of making it more expensive for borrowers to get a mortgage.
Potential Impact on Homebuyers
The high mortgage interest rates could have a significant impact on potential homebuyers. With rates being higher, borrowers may have to take out larger loans, resulting in higher monthly payments. Additionally, borrowers with lower credit scores may have difficulty qualifying for a loan at all.
Potential Impact on Homeowners
The high mortgage interest rates could also have an impact on existing homeowners. Homeowners who have adjustable-rate mortgages could see their monthly payments increase if their interest rate is adjusted. Additionally, homeowners who are looking to refinance their current mortgage may find it more difficult to do so.
Final Thoughts
Mortgage interest rates are expected to remain high in 2020, due to the uncertainty in the global economy and the US Federal Reserve’s decision to keep interest rates low. This could have a significant impact on both potential homebuyers and existing homeowners. It is important for those considering a mortgage to do their research and shop around for the best deal.