Seattle Times Misses the Mark... Again

This Sunday's paper had an article in the real estate section that I was less than impressed with. Of course, the Seattle Times pulled an AP story to fill some space, but you think that they could do better.

The article in question is: "Rates on home loans drop again, but will they soon spike?" written by Alan Zibel. The article makes use of the Freddie Mac interest rate survey that is published weekly. This is a useless number. If you are looking for a mortgage there is nothing to be gained by knowing what rates were. That was then, this is now. Yesterday's rate is just plain not available.

Also, the published rate does not include information about whether or not points were paid for the rates that are used in the survey. If you want to pay points, you can go way below market. Instead, look at today's rates compared with where they will likely be tomorrow.

Also, the article speaks about the Fed's MBS (mortgage-backed security) purchasing program that has been keeping rates down. Here's two points that I'll make about what is said in the article:

1. The Fed has said in no uncertain terms that it would take a major issue for them to intervene further and buy more bonds. We don't need false hope.

2. The Fed has been phasing out their purchasing for a while now. It's not just ending "Cold turkey."

The real scoop on rates is that they're going up. It's already started and it will continue. The Fed just raised the discount rate by 0.25% which indicates that they see inflation as a possible issue. Inflation is the mortal enemy of mortgage rates. Remember the rates in the 80's?

I don't mean to just complain about the Times' choice for articles- I just get annoyed because they seem to just be filling space with articles that really say nothing. Mortgage rates are complicated. I've made it my career to learn and try to understand the market so that I can properly advise my clients. I think these articles are confusing. The real question is: why did the article open with information about rates in December?