Interest Rates Continue to Remain Stabile

Interest rates remained about the same this week and remained near record lows. The following are some excerpts from this week's newsletter on interest rates from HSH Associates :

"Will the interest rate stability continue, and if so, for how long? Those are good questions. A growing economy with increasing credit demands and the potential to spark some inflation would typically see interest rates at least trying to rise. Presently, we have a bit of an improving economy which seems to be growing warmer by the month; however, interest rates remain tethered for the moment by policies intended to keep them low. Low, however, doesn't mean that rates cannot rise somewhat, and they should be expected to do so as evidence of economic expansion mounts.

If the improving economy is joined by rising prices there would be considerably more pressure for interest rates to rise. At the moment, though, inflation is level or declining, at least compared to last year.

We have been perhaps more optimistic than most about the state of the economy over the past few months. By our reckoning, it continues to gain momentum, and should it persist, higher interest rates must ultimately follow at some point. That's not to say that there aren't challenges or even potential catastrophes which would tend to keep rates low; any increases would likely be mild given the state of various economies both here and abroad.

That's not likely to be the case to any great degree next week, when we expect rates to rise maybe a couple of basis points. However, we can't say the same for the months just ahead. It's hard to shake the feeling that continuing solid economic improvement won't cause rates to rise, at least to some degree. "

The following are interest rate quotes from Al Hermann of American California Financial  :

 
The following are interest rate quotes from Jan Schott Bank of America, Home Loans jan.schott@bankofamerica.com 310-802-2300 :

Conforming Loans to $417,000

                    5 Yr Fixed:         2.375% @ 1.000/pts            2.875% @ 0/pts

                    30 Yr Fixed:      4.000% @ 1.000/pts            4.500% @ 0/pts

Conforming High Balance to $625,500

                   5 Yr Fixed:         2.500% @ 1.000/pts            3.375% @ 0/pts*

      30 Yr Fixed:      4.125% @ 1.000/pts            4.625% @ 0/pts

Non-Conforming Loans to $2,000,000

                   5 Yr Fixed:         2.625% @ 1.000/pts            3.000% @ 0/pts

                    30 Yr Fixed:      4.125% @ 1.000/pts            4.500% @ 0/pts

FHA Fixed Loans to $729,750

                   30 Yr Fixed:      3.875% @ 1.000/pts            4.250% @ 0/pts

Rates based on a Single Family Residence Purchase with 20% down, FICO score of 740 or greater, 30/day pricing.  FHA is based on Single Family Residence Purchase with 3.5% down payment, FICO score  minimum of 620 and 30/day pricing.   Points are for Rate only.  Closing Costs apply.  Rates not guaranteed and subject  to change daily.  Please contact me for more information on Condo, Multifamily Units and Refinancing at 310-802-2300.  

* High Balance Conforming 5/1 ARM requires 25% down