Mortgage Rates Below 4%?
Posted On: August 23rd, 2010 by James Posted In: Financial Health • Mortgage Rates • Mortgages • Refinancing
Until recently the holy grail of 30-year fixed-rate mortgages has been the 4.5% rate. I saw that price appear for 90-minute windows a handful of times in 2009, but it was like a unicorn sighting… brief and magical, and ultimately only spoken about in the hushed tones of mortgage legend.
We have recently taken a ride into this pricing territory and we appear to have set up camp here for the foreseeable future. In fact, I have been locking rates on 30-year fixed mortgages well below 4.5% in recent weeks — 4.125%, 4.25%, and 4.375% have all been locked for my clients in varying circumstances.
In these steadily declining mortgage rate environments, the no-cost refinance can start to make a lot of sense for another reason — no cost “recapture period” makes another refinance a possibility, but I digress.
We are squarely in a new trading range on the FNMA 4.0% mortgage bond coupon, and this tells me that we will be in this mid 4% fixed rate range for possibly the rest of the year, but certainly for the next 4-6 weeks. I woke up a couple of Mondays ago, and the idea of a 30-year fixed-rate mortgage below 4% suddenly seemed not only plausible, but maybe even probable. We have been steadily “stair-stepping” up into this range since April 2010, which was the highest rate period of the last 6 months. So we gain, gain, gain… with one day where we take a tumble, only to recover the loss plus more in the following trading days. This has been the pattern all summer long with no break.
One of the most valuable parts of the service that I provide is market intelligence regarding WHEN to lock. I subscribe to a service that gives me real-time market data surrounding the mortgage bond market, and I am always aware of news reports and market reports that will influence our rates one way or another. The combination of my ability to shop your file to a variety of funding sources through both correspondent and wholesale funding channels, along with this market timing data will always afford my clients the very best available mortgage rates and fees.
So the sub 4% thirty-year fixed-rate may be the new elusive unicorn, but we are already there on sub 4% 15-year fixed. I have seen 15-year fixed-rate loans at 3.75%, recently. I usually hate to make rates the main story surrounding any mortgage, as the rate is only one variable in the value of a loan, but these rates are truly worthy of note. Visit Portland Home Loan for more information.
2 Responses
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it happened today. I saw a ratesheet that came out late in the day that had a 30 year fixed at 3.875%. there is no end to this in sight either.
I can not believe how low the rates are that my clients are seeing. If you are reading this and still sitting on the fence thinking about a refi or even a purchase now is the time to contact your Lender and lock in a once in a life time low rate!
thanks for the great post!