Economic Update

Weekly Mortgage News

The National Association of Realtors reports a 0.4% dip in Pending Home Sales for June, due largely to higher interest rates and home prices. Locally, the rate dropped 1.0% in the Midwest region from May’s 7-year high.

Bottom Line for Mortgages

Speculation has swirled since last month’s meeting on when the Fed will scale back their bond-buying program, known as QE3. The potential of them “tapering” the program is the culprit behind the run-up in rates.

Fed committee members seem to be split on “tapering” bond buying, so this week’s policy announcement will have an impact. If the Fed wants to keep QE3 in-place through 2014, it could help mortgage rates. But if there are more signs they plan to cut the program earlier, it could push rates higher.

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