The latest mortgage rate forecasts for New Jersey and the nation suggest that borrowing costs could rise gradually over the coming months. Analysts from two key organizations have predicted that 30-year loan rates could rise above 4% by the start of 2018. (They were averaging 3.83% as of September 21, 2017.)

Housing and economic forecasts are an imperfect science. Mortgage rate forecasts for New Jersey are the equivalent of an educated guess. Still, they do offer some useful insight into how the market might change over the coming months. And if the latest predictions prove accurate, that change could be summed up with just two words: gradual rise.

Two Mortgage Rate Forecasts for New Jersey Borrowers

According to the latest forecasts, mortgage rates in New Jersey are expected to rise gradually through the end of 2017 and also throughout 2018.

On September 20, the economists at Freddie Mac publish their latest long-range forecast for the U.S. economy and the housing market. Among other things, this report includes an outlook for lending rates.

Freddie Mac’s analysts expect that the average rate for a 30-year fixed home will end up averaging 4.0% for 2017. Looking beyond that, they expect the benchmark 30-year loan to average 4.4% during 2018. This is just one of several forecasts that suggest New Jersey mortgage rates could climb over the months ahead.

Similarly, the Mortgage Bankers Association (MBA) updated its finance forecast on September 12, 2017. Their report shows an outlook for each quarter of the year. The industry group expects 30-year mortgage rates to rise to an average of 4.2% during the fourth quarter of 2017. Projecting further, they expect 30-year rates to reach an average of 4.5% during the first quarter of 2018.

Again, these are just predictions based on current trends. So we probably shouldn’t get too wrapped up in the exact numbers being presented here. It’s the general consensus that’s important. And the consensus appears to be that New Jersey mortgage rates will begin to creep upward through the latter part of 2017 and into 2008 (though we will likely see plenty of ups and downs along the way).

Borrowing Costs Can Vary, Based on Several Factors

The weekly industry survey conducted by Freddie Mac gives us some insight into average rates for home loans in New Jersey and across the country. Similarly, the mortgage forecasts mentioned above focus on average rates for the 30-year fixed home loan.

“Average” is the key word here. The actual rate you receive on a mortgage loan in New Jersey will vary based on several factors.

Here are some of the primary factors that can affect individual rates:

• Type of home loan. The type of loan you use can influence the rate you receive from a lender. For example, the adjustable mortgage products (such as the 5-year ARM) tend to start off with lower rates than the more popular 30-year fixed home loan.
• Borrower qualifications. A person’s credit score and other qualifying factors can also affect the mortgage rate they receive on a home loan in New Jersey.
• Discount points. Some borrowers choose to pay points at closing, in exchange for a lower rate on their home loans. In this context, one “point” is equal to 1% of the loan amount. You can think of it as a form of prepaid interest. You are essentially paying more up front in exchange for a lower rate, which could potentially save you money over the long term.

Disclaimer: This article includes mortgage rate forecasts for New Jersey and the nation as a whole, from multiple sources. These projections were offered by third parties not associated with our company. We have compiled and presented them here as an educational service to our readers.

Need a rate quote? NJ Lenders offers competitive rates on a variety of mortgage loan products. Please contact us if you would like to receive a quote, or if you have questions about applying for a mortgage loan in New Jersey.