Lending Pipeline Opening as Long-Term Interest Rates Dip to Low 7% Range

ORLANDO-With long-term interest rates now in the low- to mid-7% range, mortgage bankers are expecting a deluge of refinancings over the next several months, as qualified investors lock in fixed-rate debt for up to 20 years at an average 7.5% rate, David J. Patten of Winter Park, FL-based Interlachen Financial Group tells GlobeSt.com.

“Thanks to the Fed’s two recent interest rate cuts of 50 basis points each in the last two months, the 10-year Treasury yield has dropped as well to the high 5% to low 6% range,” Patten says. “With long-term interest rates tied to various spreads above these Treasury rates, it’s a good bet that we’re in for another year of favorable permanent financing for qualified properties.”

Life insurance firms and conduits dealing in collateralized mortgage-backed securities are “assertively processing permanent loans on qualified properties of all types that are being bought and sold,” Patten tells GlobeSt.com.