Second in History and Second This Year
Survey reports indicate that for only the second time in history and the
second time this year, mortgage rates have fallen from an even 4%, to
3.99%. This was offered by lenders countrywide on a 30 year loan, as at
last Thursday. Although today’s reduced mortgage rates benefit home
buyers and refinancers, it is dependent on them having substantial credit
and income. This will involve a 20% down payment or a 20% in home
On home loans from 1 to 10 years, current adjustable mortgage rates are
averaging 3.76% to 3.57%, which show increases when compared to last
week. Although today’s mortgage rate for the adjustable 1 year jumbo
remains unchanged, indicators for the rates for three to ten years, show
fluctuations, with the 10 years rate decreasing. On the home equity side,
average indicators show a decrease from last week, down to 6.43%
However, on the other side of the coin, the timing of this reduction is
probably not ideal. Indicators show that foreclosures are on the increase.
This has led to the perception that today’s mortgage rates are bottoming
out, due to investor’s apprehension regarding the European debt crisis.
This is aggravated by concerns regarding the true state of the American
Due to the influencing factors, demand has increased for United States
debt securities, which are regarded as a safe investment. This action has
accordingly depressed the yield on Treasury securities, with the tendency
for mortgage rates to follow the trend of the Treasury yields. As there is
little in the current mixture of economic news, to suggest inflation, there
are no indications of motivation for today’s mortgage rates increasing!