I perused this article this morning, which is one of many that back up what I have been saying in this blog for some time now. Once the Fed stops buying Mortgage Backed Securities, mortgage rates will increase. And, probably dramatically so. Recently, I saw a Mortgage Bankers Association article which indicated that the Fed is currently buying 85% of the MBS that are being sold.
That is a number to give you pause: 85%. It is highly unlikely that other buyers will step in to fill that gap when the Fed stops buying. So, what will happen? Only one thing can happen. Mortgage interest rates will rise. Will they double like the above article says? Perhaps. But even if they go up by 50%, that still puts a lot of perspective home buyers out of the market.
So, if you are going to buy, buy now. And, if you are going to refinance into a long-term fixed rate loan, do so now. You will be happy that you did.