Home : Blogs : Robert Rauf : Robert's Blog

20 year Interest Rate history, How Low can they go? Pretty Color Graphics too!

Below is a great chart of interest rates for the past 20 years. A few things to note:

If you went back a few more years than shown on this chart, rates were MUCH higher in 1989 I paid 11.25 on my first mortgage!
Points were very much the norm years ago, so the averages are artificially low
Updated for the first quarter of 2009 you can see we are a full percent lower than last year!
Keep in mind that interest rates can fluctuate greatly from one buyer to the next based on credit score, LTV, Loan amount, property type, Purpose of loan Etc...

I thought this would be a great tool for you to use!

Have a great week

Rob

Robert Rauf

Mortgage Banker

www.RobertRaufHomeLoans.com or my blog: http://activerain.com/blogs/rrauf

(732)223-1630 x102

Since 1987 I have been helping my clients fulfill their dream of home ownership!

Real Estate Mortgage Network

NJ Mortgages, New Jersey Mortgages, Mortgages in NJ, mortgage in New Jersey, Mortgages in New Jersey

Posted by Robert Rauf on 04/28/2009 07:51 AM

Comments (17)

interest rate history, interest rates, mortgage rates, real estate news, robert rauf, robertraufhomeloanscom

This post has been included in New Jersey Information Ocean County, NJ Information Toms River, NJ Information
Post is included in group: The Optimist
Post is included in group: Real Estate Rookie
Post is included in group: Real Estate Professionals
Post is included in group: Club Chaos
Post is included in group: All About Mortgages/Mortgage Networking

17 Comments on 20 year Interest Rate history, How Low can they go? Pretty Color Graphics too!

APR

This is a great chart that quickly shows two decades, I think it is a great tool to use! Think back to the 80's when Rates were well into the Double Digits. 20 years does not show the REALLLLLY high rates.

Thanks Robert. So how low do you think they'' go before rising again?

Thanks for the chart. It shows how we are spoiled when it comes to the rates. My parents paid 18% on their house. That seems unbelievable in today's market. Change is coming Change is here. Hold on to your seat.

Gabe, I wish I had an answer to that question... If I did I would probably be on a beach with a laptop, a wireless connection, churning money in the market making a fortune while sipping a drink with an umbrella in it! Reality is that mortgages are still the evil step child that investors do not want to touch, so the lack of buyers are keeping rates where they are. Uncle Sam is the biggest buyer of MBS now and it is anticipated that the Govt will own about 2.5 Trillion in mortgages when this is all over. With out buyers the price can not go up and if the price does not climb, the yield will not drop. Even in a normal market where there would be buyers I would think that any knee jerk reaction in the market would be more likely a bump up in rates than a significant drop.

Harry: I bite my tongue every time people say "gee that's high" I remember the first time I quoted 6's and people were complaining it was high... no one has a memory for where things really have been or even where they truly are. much the same as when you list a house and people think their neighbors house sold for 100k more than it actually did. My first house 11.25%, and my first refi: 9.25% and that was a 5 yr balloon!

Hi Robert: This is truly a great chart! One other factor is that today there are a lot of adders for mortgages that never use to be there - for instance - small amount adders, high LTV adders, and of course the big one - low FICO adders (and by low I mean anything under 740)!

Matt, that is true, and why I mentioned it (#4) but we have always had small loan add ons as an industry.... Last count I think there were 49 different add-ons for LTV and Credit score alone!

Robert - interesting nostalgia. I had a 12% loan in 1984, I saw others as high as 18%. We just got the word this morning that current rates were 4.5% this week. I can see them going up steeply as our money deflates more and we have to start paying off all of this national debt we are getting into.

Hey Rob - awesome chart you put together there :) We all need to work together to help the economy and get the money moving again! Lower interest rates are a start :)

love the colors by the way :)

This is what I thought of when I read your title, lol:

limbo

Love the pretty graphics! I don't want you to know that I',m old...but I can recall 16%! compared to that, 5% is practically free.

Hi Mike, keep in mind that that weekly number is a national average of all loans WITH points. so it is an idea of where rates are, but may not be "fact" for your area or your specific buyer

HELLLOOOO Kara! Its Pork roll Damnit! thanks for stopping by!

Kathleen, this is my 22nd year in this crazy job. perhaps I am getting old too??!! Nah, NEVER!

Hi Robert,
This is information I give Buyers but now I can show them your colorful graph!

APR

Hi Robert - This is great information and something we can use to share with our buyers. Thanks for sharing your information.

Cynthia, I think this graph would be great to use for both buyers and sellers. may be a good addition to a listing pack?

Jon, I am glad you found it useful!

Robert - Yep, we're spoiled. NO DOUBT! Back in the mid 80's, hubby no #1 and I were one of those couples paying in the high teens and we felt lucky then.

Donne, it is fun when you hear people say "Gee thats a high rate" these days isnt it? Sometimes I laugh out loud and then have to explain that I paid more than double for the rate on my first house!

Rob - Actually, I've been pretty luck this year. Almost all of my client's (there's always one pain the @$$) have been extremely happy with the rate that I locked them in at. Just recently, I locked in one of my little first timers in at 4.75%. When he told his parents what kind of rate he got and asked if that was a good rate, needless to say, they were speechless (due to their jaws dropping to the floor).

Leave a response…

Name:

Email:
(optional)

Comment:

What does the graphic say?