Mortgage rates continued to plummet this past week, reaching all-time lows, according to several mortgage-tracking services.
Average rates on all kinds of mortgages have steadily fallen in the past few months. The mortgage meltdown that helped spur the recession jolted the home loan industry and set mortgage rates on a downward spiral. Poor treasury rates and the Federal Reserve’s lack of confidence in the economic recovery have depressed rates in the past few months. The end of August saw a small uptick in mortgage rates across the board, but September and October have brought more stagnation. The threat of deflation has pushed mortgage rates down recently, according to Frank Nothaft, chief economist at mortgage-backing firm Freddie Mac.
Across-the-Board Mortgage Dips
Data from MyBankTracker.com shows depressed average rates on several different home loan varieties.
- 15-Year Fixed-Rate: Down to 3.99% from 4.34% two months ago (-0.35%)
- 30-Year Fixed-Rate: Down to 4.52% from 4.84% two months ago (-0.32%)
- 40-Year Fixed-Rate: Down to 5.18% from 5.34% two months ago (-0.16%)
- 5/1 Adjustable-Rate: Down to 3.41% from 3.70% two months ago (-0.29%)
- 7/1 Adjustable-Rate: Down to 3.42% from 3.83% two months ago (-0.41%)
A Good Time to Buy
Although the downward movement of mortgage rates represents negative news for the U.S. housing market and economy as a whole, rate depression isn’t a bad thing for potential homebuyers. If you’re thinking about jumping into the market for a new home, now would be a good time to act on that impulse. Rates generally have fallen by about one-third of a percent since mid-summer, but there is no guarantee they will continue to drop through the fall and into the winter. Locking in a fixed-rate home loan now could pay off down the road.
Here are some tips on buying your first home.
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