Mortgage Interest Rates hit historical lows !!!!
I am sure many have been hearing that mortgage interest rates are historically low in the last few days. It seems like in the last few years we have heard this and in many cases, it was just a marketing ploy to get the phones to ring. Well, as of this week, they have hit their lowest peak since interest rates have been tracked as far back as 1971.
So why are interest rates so low? Some investors on Wall Street fear a double dip recession approaching. And these investors will seek more stability in buying bonds, such as the MBS's, Mortgage Backed Securities. Just today, the consumer confidence index dropped from 62.7 in May to 52.9 in June. As many of us know, usually when the Stock Market drops (loses points), interest rates tend to get better, and vice verse. Another reason for the interest rates being much lower is because of the European market and the Chinese market growing slowly which affects the U.S. Markets.
Here some economic data reports that are due out this week : These reports could very well affect rates this week. I think the most important report would be the Jobs Report on Friday.
Monday, June 28: Personal Spending, Personal Consumption and Expenditures and Core PCE, Personal Income.
Tuesday, June 29: Consumer Confidence
Wednesday, June 30: ADP National Employment Report, Chicago PMI and Crude Inventories. LAST DAY FOR TRANSACTIONS TO CLOSE TO QUALIFY FOR THE HOME BUYER TAX CREDIT.
Thursday, July 1: Initial Jobless Claims, ISM Index and Pending Home Sales
Friday, July 2: The Jobs Report
Mortgage Interest Rate Outlook
Mortgage Interest Rates have gained some momentum yesterday and today, which is why we have seen the lowest interest rates in such a very long time. My fear is that I think they have edged themselves to the top per se, and have been holding strong, but that we are due for a slight correction. We have seen this take place several times in the last 6 to 12 months, just when interest rates seem to be going lower, they will creep up a few ticks or so.
Overall, I would float cautiously in the next 3 to 5 days, but for the long term, I would think rates still hold steady. Meaning that they will continue to be low in the next 30 days, but could be a tad higher than what we are experiencing now.
Word to the WISE :
Depending on your credit scores and LTV (loan-to-value), interest rates are any where from 4.25% to 4.75% for a 30 year fixed rate. If you see individuals and or mortgage companies offering mortgage interest rates at 4% or lower, there could be many points and or lender fees involved. What is being sold off on Wall Street right now are the 4.0% coupons. Just be careful in what someone might tell you or promise you.
Interest rates are low... don't play with the market and try and get 4% or lower. If you can, lock in now.
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