Mortgages At Lowest Point - Be Prepared

According to Freddie Mac, fixed-rate mortgages are at their lowest point of the year.  For the fifth consecutive week, mortgage rates declined with borrowers paying approximately 0.7% of the loan amount up front (lender fees) to get these rates:

15-Year Fixed Rate Mortgage:  3.80%

30-Year Fixed Rate Mortgage:  4.61%

Keeping in mind that this comes in the midst of mixed data economy-wise and housing-wise, the important thing to remember is the old Boy Scout motto of "Be Prepared" if you're on the market to buy.  The rates are certainly great, but they don't mean anything if you haven't done your homework and properly prepared yourself to take advantage of the current climate in the Beach Areas.

Getting pre-qualified is vital, because if there's anything to clean up on your credit record now is the time to do it.  Get it done ahead of time and you'll breathe easier.  A good loan officer will walk you through the process, and a good real estate professional should be able to direct you to a good loan officer you can trust:)

Remember, too, (as I've discussed in a previous post) the waiting game is a risk.  Mortgage rates will only go down so far, then they're just going to go up again.  Mortgage rates HAD to come down to stimulate activity on the housing market and balance out the negative impact of the housing bubble.  And mortgage rates have a lot of room to rise.  Remember in October 1979 mortgage rates were 19%...a far cry from where we are now.  There is very little room for them to go down more, but plenty of room to rise.

Will they ever go back up to 19%?  Probably not, but it's important to keep the big picture in mind as the longer you wait the closer you get to higher mortgage rates.  And just a half-percent can make a huge difference on your mortgage.

Consider that last year at this time the 30-year fixed rate mortgage averaged 4.84%...with 20% down payment or equity (in the case of refinancing).  Rates have fallen and applications for home loans have gone up.  If you're on the market for a new home in the Beach Areas, be prepared:)