in my opinion rates WILL remain very attractive even as the feds end their $1.25 Trillion (yes, with a T) mortgage back security program. as long the feds do not begin to sell off their portfolio AND private money enters the mortgage bond market to pick up where the feds left off AND inflation remains subdued THEN rates WILL remain in the 5.25%-5.5% range throughout the summer and into Q3. there has already been evidence that private money (vs. gov’t money) will be entering the mortgage bond market. WHY am i so confident? a lot of it has to do with the fact that my industry’s lending guidelines have tightened up sooooo much. WHAT does this have to do with it? simple – why would private ivestors want to purchase ultra-risky loans? you’re right – they don’t AND they won’t! however, if my industry AND the gov’t can provide evidence that lending standards have tightened and there is much LESS risk then investors feel much more confident in moving forward with purchasing mortgage bonds. although it is increasingly frustrating for me and my real estate agent partners that fewer folks are qualifying these days i completely understand the strategy. fewer, tougher, less riskier, cleaner loans = safer investment = more private investors buying mortgage bonds = stable interest rates.