Freddie Mac mortgage rates (January - July 2010)

No doubt you’ve heard that mortgage rates are low. They’re lower than they’ve ever been in history.  The news is everywhere.

Just check out some of these headlines from the last 24 hours:

  • Mortgage rates set new lows for the 6th straight week (Reuters)
  • Mortgage rates fall again; 30-year fixed at 4.54% (Wall Street Journal)
  • Mortgage rates hit another low : 4.54% (NPR)

Fixed mortgage rates are now down more than 1/2 percent from the start of the year, and 3/4 percent from just 1 year ago. The drop has dramatically improved home affordability for home buyers in Arkansas while creating refinance opportunities for existing homeowners.

From a payment perspective, a conforming, 30-year fixed rate mortgage is now cheaper by $41.94 per month per $100,000 borrowed versus July 2009.

A homeowner with a $300,000 mortgage, therefore, is saving $45,295.20 over 30 years.

Low mortgage rates rarely last long and rates appear to have troughed. After a big downhill between April and July, they’re now flat. This could mean rates have finished falling, or that they’re gearing up for another drop lower. Either way, if you haven’t talked to your real estate agent about home affordability, or your loan officer about refinancing, it may be time to make that call.

If today’s market marks the end of low rates, rates are expected to rise quickly.

Related Articles:

David Lukas is an active loan officer and can be reached at David@DavidLukas.com or by calling 501-952-3090. Also be sure to visit www.DavidLukas.com

  • Share/Bookmark

Continue Reading 0 comments Mortgage & Finance

Consumer Confidence Index July 2008-July 2010For the second consecutive month, U.S. consumer confidence is plunging. July’s official reading is its lowest since July of last year and the figures run in stark contrast to just two months ago, when the index touched a multi-year high.

According to The Conference Board, July’s figures are reflective of a more pessimistic consumer; one concerned about “business conditions and the labor market”.

Falling confidence numbers are presumed to be poor for the economy. For homeowner and home buyers in Little Rock , however, they can create opportunity.  Low confidence can influence the mortgage market in a positive manner, driving mortgage rates down.

Mortgage rates are already at their lowest levels of all-time.

The link between consumer confidence and everyday mortgage rates roots in consumer spending.

Consumer spending accounts for close to 70% of the overall U.S. economy so, the thought goes that, a less confident consumer is less likely to spend money, thereby retarding economic growth. This harms the stock markets and drives cash to bonds, including mortgage-backed bonds.

More bond demand leads bond prices to rise which, in turn, pushes mortgage rates lower.

The other side of lagging confidence is that Americans may be less likely to take new financial risks when they’re feeling unsure, including buying a new home. This can then drag on the housing market, negatively impacting home prices across Arkansas.

Falling home values can help buyers, harm sellers, and stymie would-be refinancers.

It’s tough to predict how consumer confidence data will work its way through the economy, but in the near-term, it appears to be helping mortgage rates stay low. If you’re floating a mortgage rate with your lender, or contemplating a refinance, the time may be right to lock in a rate.

Low rates can’t last forever.

Related Articles:

David Lukas is an active loan officer and can be reached at David@DavidLukas.com or by calling 501-952-3090. Also be sure to visit www.DavidLukas.com

  • Share/Bookmark

Continue Reading 0 comments Mortgage & Finance

Case-Shiller Shows Home Price Improvement In 95% Of Cities

by David Lukas July 28, 2010

Standard & Poors released its Case-Shiller Index Tuesday. On a seasonally-adjusted basis, between April and May 2010, home prices rose in 19 of Case-Shiller’s 20 tracked markets. It’s the second straight month of strong Case-Shiller findings.

  • Share/Bookmark

New Homes Sales Gain in June, But Gains Are Relative

by David Lukas July 27, 2010

June’s New Home Sales data is a major improvement over May, but gains are relative. It’s possible that the true “new home market” may be softer than the statistics suggest.

  • Share/Bookmark

What’s Ahead For Mortgage Rates This Week : July 26, 2010

by David Lukas July 26, 2010

Mortgage rates rose last week, but only slightly. Rate are still hovering near their lowest levels of all-time.

  • Share/Bookmark

Yes, You Can Still Get A Mortgage If You’re Pregnant

by David Lukas July 22, 2010

The New York Times ran an important story this week concerning pregnancy and mortgage approvals. Titled “Need a Mortgage? Don’t Get Pregnant”, the article discussed the difficulties that expecting and recently-expanded families are having with their mortgage financing.

  • Share/Bookmark

Housing Starts Ease 0.7 Percent In June — 7x Better Than The Headline Data

by David Lukas July 21, 2010

Single-family Housing Starts eased lower last month, falling by 0.7 percent from May, or 3,000 units nationwide.

  • Share/Bookmark

Sagging Homebuilder Confidence Opens The Door For Good Deals

by David Lukas July 20, 2010

Remember, it wasn’t too long ago that most builders were flush with home inventory, unable to find willing buyers. To help move product at that time, builders dropped prices and offered incentives including free upgrades. If confidence continues to sag going forward, home purchase deals of that nature may return — especially as the foreclosure market gets larger.

  • Share/Bookmark

What’s Ahead For Mortgage Rates This Week : July 19, 2010

by David Lukas July 19, 2010

Mortgage rates are artificially right now so even the slightest jolt could cause them to spike. It would be similar to what happened in June 2009 when rates rose 1.125% in just 10 days’ time. Therefore, if you’re shopping for a mortgage and like the rate you’ve been quoted, consider locking in as soon as possible.

  • Share/Bookmark

The Fed’s June Minutes Keep Mortgage Rates In Rally-Mode

by David Lukas July 16, 2010

At 7,333 words, the June Fed Minutes is the unabridged version of the more well-known, post-meeting press release. The corresponding press release was just 360 words. It turns out, the Fed’s words are doing wonders for mortgage rates.

  • Share/Bookmark