INTEREST RATE FOR 30-YEAR FIXED RATE MORTGAGE DECLINES
HOME LOANS, INDUSTRY NEWS, SHASTA COUNTY, TIPS FOR BUYERS
September 1st, 2008
One of the safest and most popular loans saw a rate decrease this past week. Nationwide,
the rate on a 30-year fixed rate loan is 6.4% with an average 0.6 point fee, down from 6.47% a week ago and 6.67% a year ago, as reported by Freddie Mac in its weekly Primary Mortgage Market Survey.
For those that can afford slightly higher payments, the 15-year fixed dropped to 5.93% with a 0.6 point, down from 6% a week ago and 6.12% a year ago. Payments on a 15-year vs. a 30-year loan are usually about 20% higher but save a considerable amount in interest over the term of the loan.
Adjustable rate mortgages or ARM’s saw a slight increase to 6.03% from 5.99% with an average 0.6 point fee but is down from 6.35% a year ago. I advise my clients to use an ARM in limited circumstances, preferring the stability and peace of mind that comes with a payment that remains the same year-in and year-out.
Economists predicted interest rates for a 30-year fixed would reach 7% by the end of this year. My experience with ups and downs in interest rates tells me that could still happen if market activity accelerates. Tough underwriting standards may keep rates in check because many borrowers are being turned down for mortgage loans, lessening the demand for mortgage money. Most real estate agents are insisting buyers get pre-approved for financing before they get in the car to look at homes. If its been a few months since loan approval was granted, it is smart to touch bases with your lender to confirm your ability to borrow. Underwriting rules are in a constant state of flux, so stay informed, and be prepared to jump through additional hoops if necessary to retain your approved status.
If you need a referral to a good loan officer, or have an real estate need, contact me:
BRAD GARBUTT
REALTOR/BROKER ASSOCIATE
REAL ESTATE PROFESSIONALS GMAC
QUARTER CENTURY REAL ESTATE EXPERIENCE
