Are Mortgage Rates Going Up Or Down? (August 13, 2009 Edition)

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Are mortgage rates going up? Are mortgage rates going down? I am a regular participant in the Bankrate.com Mortgage Rate Trend survey and this week's survey may point you in the right direction.

The Bankrate.com survey is for conforming mortgages only. It does not apply to FHA mortgages, VA mortgages, jumbo mortgages, or reverse mortgage. For rate quotes,.

The group's 30-day prediction for mortgage rates:

• 23% predict mortgage rates will increase
• 38% predict mortgage rates will decrease
• 39% predict mortgage rates will remain unchanged

I predict that rates will decrease over the next 30 days.

My advice not even be appropriate for your particular situation and I'm not always accurate besides. Heck, you may find watching the world's coolest waterslide to be a better use of your time.

Either way, here's what I told Bankrate.com:

"Near-term strength in the U.S. dollar eases mortgage rates lower."

Mortgage markets are a sensitive beast.  Just the slightest breeze and they're all shook up.  It's one reason why this blog covers such a wide berth.  Jobs, housing, consumer confidence, spending -- it's all relevant.  Each moves markets in its own right.  And when mortgage markets move, mortgage rates move.

Meanwhile, another factor in the mortgage market is the long-term outlook for the U.S. dollar.

Mortgage bond repayments are made in U.S. currency, so as the value of the dollar rises relative to other nations' currencies, the relative value of a mortgage bond repayment rises, too.  A 5 percent return can become a 6 percent return if your home currency is the Euro, as an example.

Math like this tends to attract foreign investment.

Indeed, this is what we're seeing.  At the recent treasury auctions, record foreign interest for dollar-backed bonds has helped buoy the market and keep rates low.

So long as the economy levels off and starts to expand, this trend could continue.

Don't forget, though -- there's a lot of factors that influence mortgage rates.  It's not just the U.S. dollar.  If it was, mortgage rates wouldn't be in constant flux like they are.

If you're not working with a loan officer and want to work with me, I can help you try to time a market bottom and, at the very least, make sure you're getting clear advice.  I'm never too far from my phone orso just reach out anytime.

Or, you get more passive about it.  Watch me on Twitter.  I post market updates throughout the day. Send a message to @mortgagereports so I know you're listening.