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The Week Ahead for Mortgage Rates: May 7, 2012

May 7, 2012 by · 1 Comment 

Face of a new France - A boy wears a rubber mask of Hollande's face during celebrations in Tulle | AP Getty ImagesAfter two weeks of no change, mortgage markets improved last week, pushing mortgage rates lower throughout Northwest Indiana and suburbs of Chicago Illinois.

The majority of the improvements occurred Friday after the April jobs report failed to impress Wall Street, and after it became clear that the Eurozone’s struggles with sovereign debt would continue.

According to Freddie Mac, conforming 30-year fixed rate mortgage rates fell to 3.84% nationwide, on average, for borrowers willing to pay 0.8 discount points at closing plus a full set of closing costs. 

Click here to see today’s mortgage rates.

1 discount point is equal to 1 percent of your loan size such that one discount point on a $200,000 loan would require $2,000 to be paid at-closing.

Freddie Mac’s reported rates for the benchmark 30-year fixed rate mortgage are the lowest in recorded history.

The 15-year fixed rate mortgage is also at its lowest point in history. According to Freddie Mac’s survey, the 15-year fixed averaged 3.07% with 0.7 discount points last week. One year ago, the rate was 3.89%.

This week, with a data-sparse economic calendar, mortgage markets will likely take cues from events in Europe. Notably, France has elected a new leader, one that prefers growth over austerity; and voters in Greece have “punished” austerity-backing leaders, in the process creating a split parliament.

Click here to see today’s mortgage rates.

Each event adds uncertainty to an already unstable economic environment and uncertainty favors mortgage rate shoppers in Northwest Indiana and suburbs of Chicago Illinois.

Doubt spurs investors to seek “safe” assets and U.S. government-backed bonds — including mortgage backed bonds — meet that criteria. As demand for mortgage bonds rise, mortgage rates tend to fall.

This week, rates are starting the week improved. Whether it’s a knee-jerk reaction to Eurozone news from the weekend, or low rates are here to stay is tough to know. Therefore, if today’s mortgage rates look good to you, consider locking something in. There’s more room for rates to rise than to fall.

This is The Week Ahead for Mortgage Rates: May 7, 2012.

Click here to see today’s mortgage rates.

Quick general rule of thumb when keeping an eye on mortgage rates.

Strong Economic News: $$$ from Bonds —> Stocks = Home Loan Rates Go Up

Weak Economic News: $$$ from Stocks —> Bonds = Home Loan Rates Go Down

If you or someone you know is thinking about buying a home, the combination of low home loan rates and affordable home prices make this an ideal time to buy a home. Want to know if you can afford a new home? Call or text me at 512-522-7284 to discuss your personal situation and your home loan options!

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James K Barath, CMPS®

James K Barath is a Certified Mortgage Planning Specialist®, Certified FICO® Professional, Certified Military Housing Specialist® and your FHA Home Loan Expert. He is also a graduate of Purdue University, The CMPS Institute, Dale Carnegie Human Relations Course & Napoleon Hill Foundation's PMA Science of Success Class. It's your home and your future. It's his profession and his passion. He is ready to work for your best interest. Contact James for your FREE Home Loan Approval !  His Motto: I Facilitate the American Dream Through Responsible Mortgage Lending and Financial Literacy!

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  1. […] James K Barath is a Certified Mortgage Planning Specialist®, Certified FICO® Professional, qualified liability advisor and your FHA Home Loan Expert. He is also a graduate of Purdue University, The CMPS Institute, Dale Carnegie Human Relations Course & Napoleon Hill Foundation’s PMA Science of Success Class. It’s your home and your future. It’s his profession and his passion. He is ready to work for your best interest. Contact James for your FREE Home Loan Approval !  His Motto: I Facilitate the American Dream Through Responsible Mortgage Lending and Financial Literacy!Source: welcomehomenwi.com […]



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