Did Mortgage interest Rates Drop todayHave mortgage rates dropped today?
Rates of interest are up, so why are mortgage rates down?
FreeDie Mac: Hypothekenzinsen fall for the first times in weeks | 03.05.2008
Mortgages rates have risen further and last weekend reached their highest levels since 2013, but they fell for the first consecutive couple of days, according to Freddie Mac's Primary Mortgage Market Survey. This 30-year fixed-rate mortgage fell to 4.55 percent in the period ending May 3, 2018. That is a slight decline from last week's 4.58%, but still from 4.02% last year.
On the other side, the 15-year-old FRM rose slightly from 4.02% last weekend to 4.03% this weekend. This five-year, Treasury-indexed, hybride, variable-rate mortgage fell to an annualized 3.69%. That is a decrease of 3.74% last weekend, but an upturn of 3.13% last year. However, despite the sharp rise in mortgage rates last year, the first-time buyers succeeded in increasing their shares of the mortgage markets.
How do increasing interest rates affect home buyers?
While the US remains on a par, interest rates have risen - making it more costly to buy and own a house. Freddie Mac said that the 30-year mortgage interest reached 4.4 per cent in the 22 February weekend, the highest level for almost four years.
So, if mortgage rates go up, how does that translate Into U.S. Dollar? Suppose you choose to buy a $300,000 home with a deposit of 20 per cent or $60,000 and request a $240,000, 30-year fixed-rate mortgage. Assuming this loans bears a 3.66 per cent installment - the February 2016 installment - you would be paying $1,099 per month or $395,640 in aggregate over the life of the loans - without tax and insurances.
However, at the actual installment of 4.4 per cent for the same loans, you would be paying $1,202 per month or $432,720 in all. This is an improvement of more than 37,000 dollars over the repayment period. What do you mean, interest rates are going up? Healthy US economies, increasing salaries and an optimistic view of economic expansion as a result of the GOP reduction are key drivers.
All of these leading to the expectation that headline inflation could increase, leads the Federal Reserve to raise interest rates to keep price levels up. However, interest rises also lead to more expensive credit, which can deter potential homeowners. Governments report that new home selling fell 7.8 per cent in January, and some analysts say this mirrors increasing price levels.
"The bottom line is that the rise in mortgage rates in January seems to have had a direct effect on the signing of the contract," said Peter Boockvar, senior vice president of investments at Bleakley Advisory Group, a finance planner, in a memo to customers about the January low in new home construction revenues. 2018 CBS Interactive Inc....