In case you haven’t caught the news, home loan rates have done it again, dropping to their lowest level… ever. Not only has the 30 Year Fixed rate returned to its lowest all time level, rates across the board are at their lowest levels.
Yes, that means, go ahead and choose your flavor, 30 Fixed, 15 Fixed, 5/1 ARM or 1/1 ARM, all loan types hit their lowest levels of the year, and for the weekly Freddie Mac survey of all lenders, this is the first time that all have been at their lowest level.
If you were hoping for a crack at rates below 5.00%, now is your chance. You must know, though, that rates are artificially low! Ben Bernanke and the Fed put into place last November a program to lower mortgage rates. That program though is nearing its end, as the Federal Reserve has purchased over $1 Trillion of mortgage backed securities this year and with less than 20% of allocated funds left in the program, rates are as sure to increase. The only question remaining is by how much and by when.
The chart above shows the 30 Year Fixed Rate over the last 11 months. The first red arrow shows what took place when interest rates shot up in May, rising nearly 0.75% in a matter of days. And just as when Santa comes and goes this month, the rates that are available today are likely to take off as well, only this time for good.
Interest rates that were in effect prior to the implementation of the announcement of the Fed’s program last year were well above 6.00% and a return to those levels can not be ruled out. If you are looking to refinance or currently shopping for a loan, lock your loan quickly to take advantage of the lowest rates we are likely to ever see in the future.
Remember, the reason I wanted you to see where rates have been this year is also to see how quickly they can rise. If you would like to know how I can help you, call me today. Waiting could cost you an opportunity to have a smile on your face when you say “Happy Holidays!” this month.