Weekly Update on Mortgage Rates and 3 Things You Need to Understand

Although mortgage rates started out yesterday (Feb 19) a bit lower than they did the day before, this didn’t last for long.  In fact, by yesterday at mid-morning, bond markets were already losing ground.  Because of this, lenders began issuing negative reprices.  All in all, this week’s mortgage rates are causing home buyers to look at higher closing costs if they don’t lock in over the next couple of days. 

The best borrowing rate as of right now is generally being issued at 4.375%, and this is for a 30-year fixed loan.  There has been no detectable drama in this week’s mortgage rates.  Because of this, there is no clear indicator as to how the future market for mortgage rates is going to go.  

We’ve only seen two major moves in 2014, with the big move towards lower rates occurring in January, and then back up to higher rates last week.  Because there has been no major move this week, some market specialists are predicting there to be no major move for the next few weeks.  In fact, some experts are predicting no move will take place until the harsh winter weather conditions get behind us.  

Top 3 Things to Understand about Mortgage Rates

How to secure the best mortgage rate: The best mortgage rate comes at a time in which mortgage rates are low and you have a good credit score.  Most times, when mortgage rates are historically low, you will do best to secure a fixed rate mortgage loan because this will guarantee the low rate for the life of the loan.

How mortgage rates affect the housing market: When mortgage rates are high, people tend to steer clear of buying homes.  When they are low, people of course flock to their nearest mortgage lender and apply like crazy for a loan.  Because mortgage rates tend to fluctuate on a daily basis, this means the housing market is affected from one day to the next as to whether or not people are interested in buying a home; however, when it is predicted that mortgage rates will stay somewhat low for an extended period of time, this is when the housing market booms.

Things that affect mortgage rates: There are three main factors that affect mortgage rates: Type of loan, the Federal Reserve and your credit score.  Each factor plays its own part in the type of rates that you will qualify for; however, the two most influential are your credit score and the Federal Reserve.

If you would like more information on current mortgage rates, or info on securing a mortgage loan, please don’t hesitate to contact Anthony VanDyke at ALV Mortgage today.