Greg McBride of Bankrate breaks down mortgage rate expectations

  • Benchmark short-term interest rates went up in December, but won't in January.
  • The raise in the rate last month means economic confidence.
  • Buyers enter the market when they need to, but those already in look at longer term rates for more optional purchase, or as an investment strategy.

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As was widely expected, the Federal Reserve raised the benchmark short-term interest rate at its Dec. 19 meeting. It had been at zero for seven years prior to the quarter-point increase. Greg McBride, CFA, and senior financial analyst at Bankrate.com, said to expect gradual adjustments to the prime rate over the course of 2016.