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Market conditions as a result of the U.S - Chinese trade war are unprecedented

Don’t look now, but interest rates on home loans have started dropping again. As the financial markets continue to have trouble digesting the trade tensions between the United States and China, investors are putting their money into the relative safe haven of the bond market. The bottom line? Home loan rates are falling and now could be the perfect time to refinance or buy a home.

As we’ve reported over the past few weeks, the United States and China have taken turns hiking tariffs on each other’s export products and as a result, the world’s financial markets have been very unstable. For the first time since the rhetoric between President Trump and President Jinping started heating up, investors are beginning to bet on the possibility of a recession. In fact, this morning the yield on the 10-year Treasury bond actually dropped below the yield for the 3-month Treasury bill, a rare phenomenon known as an “inverted yield curve”. While that’s a highly technical term, just know this - many financial experts consider it a serious problem, one that could signal the onset of a severe recession.

Bloomberg reported this morning that the yield curve situation hasn’t been this severe since the 2007 financial crisis. As a result, mortgage rates have dropped to their lowest level in nearly two years and could drop even further.

Meanwhile, in the relatively peaceful world of the housing market, many homeowners and home buyers have been oblivious to the fact that home loan rates are actually falling. Don’t be caught on the sidelines! With property values rising in most parts of the country, now is a great time to apply for a Nutter Cash Back Refinance, especially if you’d like to use some of your equity to pay for home renovations or to consolidate high interest debts such as credit cards.

Similarly, if you’ve been thinking about buying a house but aren’t sure if it’s the right time, think again. Housing inventories are starting to climb in many parts of the country which is giving many buyers more options to consider. Now is a great time to jump into the market and get a great low fixed rate on your home loan.

Waiting for rates to drop even lower isn’t a very smart strategy at the moment. While some experts have speculated that the Federal Reserve may respond to the instability in the markets by cutting its interest rates, the minutes from the last Federal Reserve meeting may have dashed those hopes. It appears now that the earliest the Federal Reserve might consider cutting rates will be at the end of the year. Meanwhile, home loan rates are continuing to fall this week, making the prospect of locking in a low fixed rate that much more appealing if you do it right now.

If you’re considering buying a house this year or you’re an existing homeowner looking to refinance, now is the time to take action. Doing so could save you thousands of dollars in interest over the long haul.

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