Mortgage Rates Moving Lower
are improving.
After rising through three consecutive weeks, mortgage rates have started to shift lower. Conventional mortgage rates have dropped as compared to last week; and rates and VA mortgage rates have moved lower, too.
The number of U.S. homeowners eligible for a is increasing. Monthly savings via the and programs have multiplied, and the benefits of a have grown, too.
With current mortgage rates south of four percent, the market remains favorable for a refinance or home purchase.
Buyers can afford 10% more home as compared to the start of last year.
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Mortgage Rates Still In 3-Percent Range
According to Freddie Mac, the average 30-year conventional fixed rate mortgage rate dropped last week, shedding 1 basis point (0.01%) to 3.84% nationwide.
15-year rates also dropped, moving 2 basis points (0.02%) to 3.05 percent.
These rates, which are based on a survey of more than 100 banks nationwide, are available to “prime” mortgage applicants willing to pay an accompanying at closing.
However, as this holiday-shortened week opens, shoppers are finding mortgage rates somewhat better than what Freddie Mac reports.
This is because, last week, after the Freddie Mac survey concluded, the Federal Reserve published the minutes from its most recent meeting, held in late-April. The minutes suggest that the Fed Funds Rate may remain near zero percent for longer than Wall Street originally anticipated.
Furthermore, the Fed said that first-quarter growth was slower than expected.
The release of the minutes sparked a mortgage-backed securities (MBS) mini-rally, lowering consumer rates approximately one-eighth of a percentage point. Today’s rates are nearer to 3.75 percent.
Zero-closing cost mortgage rates are slightly higher.
Not everyone will get access to this type of pricing, however. The weekly Freddie Mac survey carries three big caveats.
First, the Freddie Mac survey is aimed at “prime borrowers” only.
A prime borrower is one who is able to verify income, who can show credit scores of 740 or higher, and who has a downpayment of twenty percent or more for a purchase. Borrowers not meeting these criteria get access to nominally higher rates.
Second, the Freddie Mac survey reports average mortgage rates.
This means that some mortgage applicants get quotes which are higher than the national average; and, some get rates which are lower.
Recently, rates have been lowest for borrowers in western states such as California, Oregon, and Washington; and highest for borrowers in southeastern states including Florida, Georgia, and Alabama.
And, third, the Freddie Mac mortgage rate survey applies to conventional mortgage rates only.
Mortgage applicants in search of for an FHA loan; or VA mortgage rates for a VA loan won’t be looking to Freddie Mac loan programs. and are backed by different government agencies from a Freddie Mac loan and, as a result, borrowers with those programs get access to different mortgage rates.
Click to see today's live mortgage rates
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Mortgage Rates : What To Watch For This Week
This week, the U.S. economic calendar includes a number of notable influences, including data from housing and the release of GDP.
However, one unlikely item which may affect this week’s and mortgage rates is the value of the U.S. dollar against the Euro and other currencies.
The dollar is linked to mortgage rates because it’s the currency in which mortgage bonds are denominated. When the U.S. dollar rises, the value of holding mortgage-backed securities (MBS) is lifted along with it. This increases demand, which pushes down yield.
There are multiple Federal Reserve members scheduled to speak publicly this week. Their comments about the future of the domestic economy; and how the Fed may alter the Fed Funds Rate will change the value of the U.S. dollar versus other currencies.
This week’s conomic data will affect rates, too.
The complete economic calendar for the week follows :
- Monday : Cleveland Fed President Loretta Mester speaks; Federal Reserve Vice-Chairman Stanley Fischer speaks
- Tuesday : Federal Reserve Vice-Chairman Stanley Fischer speaks; FHFA Home Price Index; New Home Sales; Richmond Fed Manufacturing Survey; New Home Sales; S&P Case-Shiller Index; Richmond Fed President Jeffrey Lacker speaks; Durable Goods
- Wednesday : 5-Year Treasury Note Auction
- Thursday : Jobless Claims; Pending Home Sales Index; San Francisco Fed President John Williams speaks; Minneapolis Fed President Narayan Kocherlakota speaks; 7-Year Treasury Note Auction
- Friday : GDP; Consumer Sentiment
Mortgage rate shoppers should pay special attention to Wednesday and Thursday, when the auction results are announced for the 5- and 7-Year Treasury Notes. Strong demand for the notes will suggest strong demand for dollar-denominated assets, which can be a clue that mortgage rates will soon drop.
Get A Complimentary Rate Quote Now
Mortgage rates are falling and been beneath four percent for more than 7 months. If you’ve been waiting to purchase or refinance, today marks a good day to explore your options for a new home loan. Rates can change quickly and without notice.
Get a complimentary mortgage rate quote now. Rates are available for free, with no obligation to proceed, and with no social security number required to get started.
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