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Interest Rates Really ARE Low. No, Really, They Are.

We had one of our key lenders ask a great question in the sales meeting the other day.

"Going back to 1971, when was the FIRST time the 30 year fixed rate hit 6.25?"

Guesses were flying everywhere. No one was even close.

The answer? Summer 2002.

That's right. In the 70's, 80's and 90's, the 30 year fixed was always above 6.25%. Always. It did not hit 6.25% until

four years ago.

The next question was "What is the 30 year fixed at today?"

And the answer of course, is 6.25%. That's for a non-conforming loan by the way - conforming loans are at 6.15%.

So when we say that by historical standards, these are great rates, this adds some real perspective to it.

These really are great rates, and that's why people are starting to refinance again. And here in Marin, we're seeing a little glimmer of renewed buyer interest also.

Posted by Bob Ravasio on 12/12/2006 05:51 PM

Comments (3)

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3 Comments on Interest Rates Really ARE Low. No, Really, They Are.

DEC

2006

Bob - alot of people just don't have that perspective. I found that when the rates first blipped up over 6%, people panicked and thought that the rates were high. Good grief - when I first came into the business, rates were 18-19-20%, depending on the type of loan!

You're so right, provide people this perspective, and the rates really are low, REALLY LOW!!

Ann

I started in the mortgage business in 1980 with rates at 12.5% and 13.5%. In 1981, we tried to do business at 18, 19 & 20%. These rates in the high 5's and low 6's are still great. Of course the average mortgage has increased dramatically, but so has income for most people. I chuckle quietly when people stress out about 1/8 % increases.

DEC

2006

Great point. I put a interest rate trend chart on my other blog awhile back. Take a look, it goes back to 1971

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