Wells Fargo refinance rates have recently reached new all-time lows but are now beginning to creep upwards. During the last week in November, refinance rates for mortgages sat around 4.49% for 30 year fixed-rate loans. Since then, the 30-year refinance rate has moved back up to 4.74%.
Much of the increase can be attributed to a rally in the 10 year treasury yield rate which had a strong rally last week, pushing mortgage rates higher. The 10 year treasury rate and rates for 30 year fixed-rate mortgage rates have correlated strongly since mortgage data was first collected in 1971.
This correlation has deviated slightly this year because of the Federal Reserve’s program to purchase mortgage backed security, but the correlation will likely become more visible as the Federal Reserve winds down its support of the mortgage market.
Currently the Federal Reserve is planning to buy mortgage-backed securities through March of 2010. If the Federal Reserve does not renew its commitment to purchasing mortgage-backed securities after that date, it’s likely that refinance rates will jump back above 5%.
With increased scrutiny on the Federal Reserve and its massive stimulus-era capital injection programs by Congress and the general public, it’s likely that the Federal Reserve will pair back its support of the US economy over the course of the next two years.
Wells Fargo certainly has excellent refinance rates, even if they have tipped back up in the last week. If you have a mortgage with an interest rate of 5% or more, it’s definitely time to consider refinancing your home during the next couple of months to save on some interest as part of your monthly mortgage payment. This will allow you to put more money towards the principal of your debt and pay off your home sooner.