Please use Subprime Blogger to keep up with current mortgage rate trends.  There are also several articles to help you keep up with average mortgage rates.

Interest rate predictions for July could bring bad news for those that hope to get mortgage rates under 5%.  When looking at the 10 year treasury rate, it looks like there is strong support at 3.4% and the 10 year has been sold off very hard since almost hitting 4%.  I would be very surprised if we continue to see a sell off through the support level of the 50 day moving average.  If we see a bounce off of 3.4%, look for mortgage rates too see a bounce off the 5% level.

President Obama and Ben Bernanke are going to do everything possible to not allow this to happen, but sometimes there is nothing the government can do as this is a free market capitalist country.  The buying of mortgage backed securities coupled with the auctioning of treasury bonds has pushed average mortgage rates lower after the quick rise from 4.8% to 5.6% in June.  At one point the government is going to run out of ammo for keeping mortgage rates low.

Unfortunately, when they do run out of ammo, there is going to be a slingshot effect with interest rates.  If you remember the first two weeks of June, when rates went up almost a full percentage point in two weeks, you know exactly what I am talking about.  Sadly, it could be even worse as we are likely to see inflation start to set in as the Federal Reserve Bank has been printing money at will.

With that being said, the interest rate predictions for the month of July shows interest rates going higher, especially towards the end of the month.  It is very possible that we will see mortgage rates grind sideways to downward until the 10 year treasury rate hits support, but then we are likely to see a strong uptrend.  By looking at this chart of the 10 year, you will notice that we are almost at support.  There has been a weak bounce so far, but expect that uptrend to get much strong on its push towards 4%.

If the 10 year treasury rate does hit 4%, look for mortgage rates trends to push rates towards 5.85% or higher.  If you have been considering a refinance or buying a new home, now might be the best time to do it when mortgage rates are at the bottom of an upward trend channel.  If you wait until the end of July, you might see daily mortgage rates much closer to 6%.  Ultimately, interest rates looked be putting in a short term bottom at the beginning of July and then I expect to see an increase through August and possibly into September.  If this is the case, we may see a strong decline in the stock market.