Mortgage Rates Hit Another Record Low

According to the Primary Mortgage Market Survey the national average for the 30 year fixed interest rate has dipped below 4%.

The average 30 year rate is 3.94% with .8% in fees and points.

This rate sets a new record low for interest rates. The first week of October in 2010 the average 30 year rate was 4.27%.

What does this mean for borrowers?

Now is an excellent time to be able to purchase a house, or if you have equity to refinance. There are reports that some borrowers are still on the fence, wondering if rates are going to bottom out anymore.

Last year there were the same concerns. A common question we got was, “Are Mortgage Rates Going to Go Up in 2011?

At the end of 2010 mortgage rates started to rise. It looked like rates in 2011 would go up and stay up. In February rates hit 5%, but sense then have again declined to the current record low.

Investors are still extremely cautions, the economy remains in shambles, there is a threat of a second recession, unemployment is still very high, the housing market has not turned around. All of these factors are contributing to the low interest rates.

Are the low rates going to stick around?

Yes and no. In there short term there is no economic forecast that would suggest rates will increase “over night”. Once mortgage rates increase for good it will most likely be a slow process following the recovery of our economy and the housing market.

Should I buy or refinance?

Yes. Record low housing prices and record low rates is a recipe for a great home with a low payment. Even if house prices stay low for a few more years it is still an incredible opportunity to purchase a home. In fact never in the last 50 plus years have Americans had the opportunity to get locked into such an incredibly low 30 year interest rate.

Mortgage Rates 2010 – January through December

Lets take a look back at 2010 interest rates from January through December according to Primary Mortgage Market Survey.  We are going to use the 30 year fixed rate.  The 15 and 5/1 ARM trended similarly, although there are some subtle differences throughout the year.

We started the year out with higher rates then we would reach throughout the rest of the year save the second week in April where rates spiked shortly and then return downward.

On January 7th the 30 year fixed was at 5.09%.  It held within a few bases points of 5% all the way through the first week of April.  4.93% was the lowest and 5.09% was the highest rates would reach within that 3 month stretch.

April 8th we saw rates hit the high point of the year at 5.21%  After again holding right around 5% through mid May we started seeing the downward spiral which would take the 30 year fixed nearly under 4% in just a few short months.

May 13th marked the beginning of the interest rate decline.  At 4.93% on the 13th rates ended May at 4.78%.

June was the same story.  Down down down.  By the end of June rates were at 4.69%.

July was a large decrease.  Rates ended July at 4.54%.

August we witnessed the 30 year dip below 4.5%.  On August 5th rates were 4.49% and by the end of August 4.5% seemed high as rates were 4.36%.

September and October just continued the downward trend which lead into November when we say rates hit their lowest point.  On November 11th the 30 year fixed rate was 4.17%, the very day that marked the turn around for interest rates.

From that day on rates started rising.  A week later they were 4.40%, then just one month after that on December 16th rates were sitting at 4.83% and ended the year at 4.86%.

January to December 2010 was a wild year for rates and mortgages.  In an economy which many homes across the nation are worth less than that which is owed on them refinancing was a difficult or impossible thing to accomplish with many homeowners.  On the purchasing side of the coin things haven’t been much better than this in decades.  Low interest rates and bottomed out house prices means many people got great deals in 2010 on the home they are now living in.

What does 2011 have in store for our nation? What does 2011 have in store for you?

We hope great things!

Happy New Year!

Be financially wise in 2011.

3 Month High for Average Mortgage Rates – Nov 28th

The national average mortgage rates have increased to a 3 month high.

The 30 year fixed rate average has not been above 4.40% since August 19th, and the 15 year hasn’t seen this high of rates since mid September.

Here is a look at where the rates are as of this past Friday.

November 24, 2010 30-Yr FRM 15-Yr FRM 5/1-Yr ARM 1-Yr ARM
Average Rates 4.40 % 3.77 % 3.45 % 3.23 %
Fees & Points 0.8 0.7 0.6 0.6

Last week the 30 Year Rate was at 4.39% but the week before that it was at its lowest point ever, 4.17%.

Should you lock in that rate?

Rates are bound to eventually go up.  With the holidays in full swing and the new year on the horizon it is uncertain if rates will continue to remain so low.

These rates are so incredibly low it would be foolish not to get a loan locked into a fixed rate if you can, whether for a refinance or a purchase.

There are some great options for people out there too.  There are loans for people with poor credit, and refinance options for people that are upside down in their mortgage.

Need to calculate your mortgage? Try our Mortgage Calculator.

National Mortgage Rates – November 4th

Mortgage Rates for November 4th have pretty much held steady.

This weeks average rates according to the Primary Mortgage Market Survey from Freddie Mac are as follows.

November 4, 2010 30-Yr FRM 15-Yr FRM 5/1-Yr ARM 1-Yr ARM
Average Rates 4.24 % 3.63 % 3.39 % 3.26 %
Fees & Points 0.8 0.7 0.6 0.7

Last week the rates looked like this.

  • 30 year – 4.23%
  • 15 year – 3.66%
  • 5/1 ARM – 3.41%

What can we expect from here on out?

The huge swing of power in the elections are sure to affect consumer confidence, which in turn will affect the economy and eventually trickle into interest rates.

As things start unfolding we will be sure to let you know the details.

Until then it is a great time to take advantage of purchasing a new home or refinancing your existing home.

Mortgage Rates Drop Again – New Record Oct 7th

According to the Primary Mortgage Market Survey from Freddie Mac the new average mortgage rates have yet again hit a new low.

October 7, 2010 30-Yr FRM 15-Yr FRM 5/1-Yr ARM 1-Yr ARM
Average Rates 4.27 % 3.72 % 3.47 % 3.40 %
Fees & Points 0.8 0.7 0.6 0.7

This information is based on Mortgage Companies all over the nation.  Freddie Mac compiles the information and averages it out to determine where rates stand today.

Is time to take Action?

You know from reading my mortgage updates in the past that I believe it is no time to drag your feet.  If you are in a position to be able to refinance now is the time to jump on board.

What if you are say 12 years into a 30 Year mortgage, is it worth refinancing then?

This is an excellent question and one that takes some research on your part to answer.  If you are around 12 – 15 years into your mortgage then chances are you are paying much more of the principle with each and every payment.  (Interest is front loaded and you pay nearly 90% interest in the first 10 years of a mortgage.)

Therefor if you are paying mostly principle now why refinance.  Well in this case there are only three factors you need to consider and that is TERM, TERM and TERM.

If you can refinance into a 10 year mortgage and have a similar payment because rates are so low, you just knocked 8 years of your mortgage.  Do not and I repeat DO NOT refinance into another 30 year mortgage if you are many years into your current 30 year fixed.

Consider your options and have your loan officer show you the options for a 10 year and 15 year mortgage.

If you want some more help check out our mortgage tips.

Mortgage Rates are Up and Down – September 16th

For the second straight week the 30 year mortgage rates have moved up, but the 15 year and 5 year ARM have decreased slightly.

Before we get into the speculation lets see the rates for this week.

  • 30-Yr Fixed – 4.37 %
  • 15-Yr Fixed – 3.82 %
  • 5/1-Yr ARM – 3.55 %

And compare those to last week…

  • 30-Yr Fixed – 4.35 %
  • 15-Yr Fixed – 3.83 %
  • 5/1-Yr ARM – 3.56 %

It is pretty hard to draw any conclusions based on these rates.  At the very basic assessment rates are still incredibly low and if you are able to refinance or are purchasing a home you should count yourself lucky.

Is it worth waiting to see if they get lower?

No.  Could they get lower? Yes, but at this point rates have not been this low for half a century.  It is not worth the risk to hold out for lower rates.  If there is even a sniff of a strengthening housing market or economy you can expect to see these rates jump back up.

These rates are based on the Freddie Mac Primary Mortgage Market Survey.  Banks all over the nation are polled for there current rates and these are the averages.

The 30 year fixed is base off of 0.7% points, while the 15 year and the 5/1 ARM are based off of 0.6% points.

Old Article? See todays mortgage rates.

Mortgage Rates Slightly on the Rise – September 9

Rates Moving UpMortgage rates back bounce to where they were on August 26th.

It is not to often these days that we see rates on the rise.  Although some experts think that is about to change.

Todays rates are slightly higher than they were last week.

  • 30-Yr Fixed – 4.35 %
  • 15-Yr Fixed – 3.83 %
  • 5/1-Yr ARM – 3.56 %

Last week rates looked like this.

  • 30-Yr Fixed – 4.32 %
  • 15-Yr Fixed – 3.83 %
  • 5/1-Yr ARM – 3.54 %

These rates are based on the Freddie Mac Primary Mortgage Market Survey.  Banks all over the nation are polled for there current rates and these are the averages.

The 30 year fixed is base off of 0.7% points, while the 15 year and the 5/1 ARM are based off of 0.6% points.

Old Article? See todays mortgage rates.

Should you lock your rate in now?

Rates are at the lowest they have been in many decades.  It is foolish to not lock in now while they are this low.  You may make the estimation that rates will continue to fall in a week economy, but to me the risk/reward factor is not large enough to float your rate.

Once lenders catch a glimpse of a strengthening economy those rates are likely to shoot up by a half percent or more.

Back in January and February of 2008 rates were dipping close to 5%.  There was a frenzy of refinances and loan locking.  Many people decide to try and float their rate to get under 5%.  Within an hours time lenders put a hold on rates so no one could lock.  When that hold was lifted rates were sitting back at 5.5% and continually rose after that.

Many people missed out on 5% fixed rates, including me. Yes, I decided to try and hold out for a lower rate.  That decision as cost me more than 60 dollars a month for more than a year and half now.  To date I have blown $1080.  If I stay in this mortgage for just 5 years that will be a  $3600 dollar mistake, and if I stay in the house for the entire term of the mortgage it will have been a $21,600 dollar mistake.

You know, I have never actually done the math on that decision and it hurts.