Everyone knows that interest rates fluctuate, but the last several business days have drilled this home. It doesn't help when you combine major economic news with light volumes and thinly staffed trading desks.
Friday saw a lot of volume, and bond prices dropped. Yesterday, however, the supply dried up, and economists began to pick apart options that the Fed has to improve the economy. Ongoing worries regarding domestic and global growth sent equities lower and Treasuries higher.
After all, housing is still very sluggish, even with these great rates, as evidenced by the Existing and New Home Sales figures last week. If the borrowers or property do not qualify under current guidelines, what difference do rates make? And if consumers don't have jobs, they can't really go out and spend money to boost the economy.
Rates started off the week extremely low, but have inched up slightly. However, high quality buyers can still get a 30 year fixed at 4.25% (APR 4.33%) with little to zero points (depending on down payment, credit scores, etc). FHA is just as strong!
Jumbo money is getting very attractive these days as well, with 30 year fixed rates in the low 5's and 5/1 ARM's in the high 3's. Good stuff.
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