It’s a New Year! Here’s the inaugural post from our local expert among lenders. Peter Accolla, George Mason Mortgage, offers insight into what the New Year means for the mortgage market. You’ve likely heard about the recent rate hike. But Peter offers perspective on what this could mean for you in the near term and throughout 2016. Peter is an experienced lender whom my clients have trusted for the last 10 years. Welcome, Peter to The Story Behind the Home. I appreciate his experience and perspective as a very important part of your real estate story unfolds.
It’s a New Year of opportunities and changes. If you’re considering a sale or purchase, you may be wondering what to expect from the mortgage market going forward. The short answer is that the Federal Reserve (FED) pretty much has full control. A reality that begs the question “How quickly will the FED raise short term interest rates this year?” The overall expectation is that short term rates (the Federal Funds rate) will be 1.5% by the end of 2016. Currently, it is .5%. This means that there is an expectation of a .25% increase each quarter of this year. My opinion (and the opinion of many local loan officers and lenders in our area) is that if we see the FED hike the Federal Funds rate more quickly than expected–insinuating a stronger economy and the need to control inflation–we’ll see mortgage rates increase faster as well. If we see a steady increase of the Federal Funds rate each quarter over the year, we’ll see our average 30 year fixed rate go from roughly 4% (where it is now) to somewhere around 4.5% by year end.
The effect on your purchase power, interest rate, and loan approval will vary according to a set group of criteria. I’ve provided my contact information below. If you’ll give me 15 minutes of your time or visit my website to provide responses to a few questions, I can show you what the new year in the mortgage market means for you.
Let’s get started.
Best regards, Peter
Peter S. Accolla II
Branch Manager/Mortgage Banker George Mason Mortgage, LLC
(703) 259-0731 (O)
(703) 888-6889 (C)
(703) 653-3052 (F)