Interest Rates Are Coming Back Down

By
Mortgage and Lending with Paramount Residential Mortgage Group, Inc NMLS# 262906

Mortgage rates fell to the lowest level since May as home-loan refinances surged. Rates had reached record lows of 4.5% for a 30yr fixed rate loan in April until the end of May where they spiked over 1½% in two days time.Up and down arrows

Since then they've slowly edged back down - Today the average 30-year rate fell to 5.14 percent, down from 5.20 percent. The 15-year rate was 4.63 percent.

Some more technical data:
     - Overall home loan applications rose 4.3 percent this week:
            * Purchase applications fell 9.4 percent 
            * Refinance applications rose 18 percent
     - The global mortgage crisis has cost the world's financial firms almost $1.5 trillion in losses so far.
     - The Federal Reserve kept the federal funds rate at between zero and 0.25 percent last month.
            * Their statement at the time was "The rate will stay at "exceptionally low levels" for an "extended period".

At this point the Fed is pleased with how their programs have positively affected the financial system and economy as a whole, so the general concensus is that we're going to see "more of the same" out of the Fed.

 

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I specialize in working with first-time homebuyers across the state of Florida. I know FHA, VA, USDA Rural Housing loans inside & out and would love to answer any questions you might have.

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Comments (5)

Connie Harvey
Pilkerton Realtors - Brentwood, TN
Realtor - Nashville TN Real Estate

Dan, this is very good news indeed! I try not to watch them every day but didn't know that they had done anything but go up lately.

Jul 20, 2009 10:30 AM
Dan Magstadt
Paramount Residential Mortgage Group, Inc - Lake City, FL

I agree!! A little good news for once!

Jul 20, 2009 10:39 AM
Terri Onigkeit
Keller Williams of Northern Colorado - Fort Collins, CO
GRI

Great information, wish I had a crystal ball to know when they will really go up. I do think they will.

Jul 20, 2009 10:50 AM
Nevin Williams
Fairway Independent Mortgage Corporation - Cary, NC
Senior Mortgage Advisor

Dan - I think as soon as the feds stop buying the MBS rates will rise substantially

Jul 20, 2009 01:11 PM
Dan Magstadt
Paramount Residential Mortgage Group, Inc - Lake City, FL

Terri - Interest rates are absolutely going to be going up, and unfortunately I think it's going to be a dramatic jump...I wouldn't be surprised to see 8%-9% in the next couple years...

Nevin - I completely agree...It's been nice that they've stayed in the 5's for so long, but we're in for a surprise when the Fed pulls out of the market.

This is why I keep telling people NOW is the time to buy!!!

Jul 21, 2009 07:05 AM