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Watch Out for Mortgage Rates When Gas Prices Rise
March 25, 2009 by James K Barath, CMPS · Leave a Comment
Don’t look now but oil prices are climbing.
This should worry today’s home buyers and would-be refinancers because some of the same forces that helped to push crude past $50 for the first time in 4 months also cause mortgage rates to rise.
March 18, the Federal Reserve committed an additional $1.15 trillion to support the economy.
Since the announcement, investors have questioned whether the Fed is purposefully spurring inflation. The Fed’s total debt purchases now total $1.75 trillion.
And to finance its purchases, the Federal Reserve is printing new money, devaluing the U.S. dollar along the way. This then leads to inflation which, all things equal, causes oil prices to rise, gas prices to rise, and mortgage rates to go with them.
As we’ve seen the last few summers, oil prices and mortgages seem to touch their yearly high points while the weather is warmest.
(Image courtesy: The Wall Street Journal)
About the Author: James K Barath is a Certified Mortgage Planning Specialist and your Northwest Indiana FHA Home Loan Expert. He is also a graduate of Purdue University, The CMPS Institute, Dale Carnegie Human Relations Course & Napoleon Hill Foundation's PMA Science of Success Class. It's your home and your future. It's his profession and his passion. He is ready to work for your best interest. Contact James K Barath today and Get Qualified for Your FREE FHA Home Loan Approval!
His Motto: I Facilitate the American Dream Through Responsible Mortgage Lending and Financial Literacy! 
