Homebuyers Move off the Fence as Mortgage Rates Drop Yet Again
If you’ve been considering buying your first home or moving up to a larger home, conditions have once again turned in your favor. According to Bankrate.com’s weekly national survey, mortgage rates hit yet another record low, with the average 30-year fixed mortgage rate falling to 4.12 percent. The average 30-year fixed mortgage has an average of 0.29 discount and origination points.
Meanwhile, the average 15-year fixed mortgage retreated to 3.34 percent, while the jumbo 30-year fixed mortgage slid to 4.55 percent. The average 5-year and 7-year adjustable mortgage rates dropped to 3.02 percent and 3.24 percent, respectively. All of these are record lows.
This most recent drop in rates was just announced by Ben Bernanke and the Federal Reserve, along with a pledge to keep short-term interest rates on hold until late 2014. However, given the continued volatility in the market, along with the unpredictable nature of a presidential election year, if you’re considering a home purchase or a refinance, act quickly to take full advantage of low rates.
Bankrate points out just how significant these historic rates really are. Think about this: The last time mortgage rates were above 6 percent was November 2008. At the time, the average 30-year fixed rate was 6.33 percent, meaning a $200,000 loan would have carried a monthly payment of $1,241.86. With the average rate now at 4.12 percent, the monthly payment for the same size loan would be $968.72, a difference of $273 per month for anyone refinancing now.
Here are other important specifics from Bankrate’s national weekly mortgage survey:
- 30-year fixed: 4.12 percent – down from 4.25 percent last week (avg. points: 0.29)
- 15-year fixed: 3.34 percent – down from 3.45 percent last week (avg. points: 0.30)
- 5/1 ARM: 3.02 percent – down from 3.09 percent last week (avg. points: 0.31)
If you’d like to take advantage of these incredible market conditions, remember to do the following before embarking on your home search:
- Make sure your finances are in order and your credit is in good shape.
- Research homes in neighborhoods you’re interested in online first to help narrow your selection. This will save time when viewing homes in person, allowing you to place a bid faster.
- If you need to sell your current home first, contact a real estate professional right away to find out what repairs/improvements you might need to make before putting your home on the market.