Not being a seer, soothsayer, or economist I cannot promise where rates will be later today, much less tomorrow or a month from now. But it's a fact that what we see as "low" today is nowhere near our potential bottom.

How low?

Even at a moment of overwhelmingly good news on the rate front, interest levels have the potential to fall further. According to Forbes magazine (A Brief History of Stock Fads, September 14, 1992), "T-bills got so popular that for brief periods between 1938 and 1941 they carried negative interest rates."

Now here's an interesting concept. Apparently to earn "negative interest" one would go to the U.S. Treasury, line up before a federal teller, hand over cash to purchase a T-bill, return at some point in the future, get less cash back, and then feel great about investment planning.

No one knows where interest rates are headed. But we do know where rates are today, and where they are at this moment suggests that homes and financing are markedly more-affordable than even a year ago.

While it is possible that rates may fall further, it is equally true that they could rise. By any standard, those with an interest in buying or refinancing are in a borrower's market, and that's great news for consumers.

The betting here is that biggest problem lenders will face in the next few weeks is a shortage of waiting-room chairs. As economies overseas continue to flounder (and money comes to the U.S.) , and as events in Washington remain unsettled (and investors move dollars from stocks to bonds), it seems likely that for the moment -- and perhaps for weeks to come -- interest rates will be wonderful to behold.

Question Of The Week

Q Do lenders regard bankruptcies and foreclosures as equally bad?

A I suspect if a poll were taken that lenders would be somewhat tolerant of bankruptcies and utterly offended by foreclosures.

Bankruptcies can be a result of over-spending and a lack of financial discipline, but they can also result from events outside the control of an individual such as auto accidents, medical bills, community-wide lay-offs, and natural disasters. With bankruptcies, lenders want to know "why" and in many cases will move quickly to fund those with bankruptcies if there has been a pattern of prior good credit.

Foreclosures are different. Foreclosure means a mortgage lender had to battle with the borrower, mortgage insurer, and courts to get back money -- and maybe took a loss. Such an event raises management, shareholder, and regulatory concerns that most lenders want dearly to avoid, and so you can imagine the bells that go off when a would-be borrower has had a foreclosure.

Weekly Resource