July 2, 2015
Monday and Tuesday of this week we saw mortgage rates trying to recover after being pushed into new, higher territory. Both conventional and FHA mortgage loan interest rates took a turn for the worse late last week with 30-year fixed rate conventional mortgages moving higher into the four percent range. At the time of this writing those fixed rate conventional mortgage loan interest rates were reported at 4.125% best execution.
FHA mortgage loan rates also moved higher–the previously reported comfort zone of 3.75% has been replaced with a range of best-execution rates with 3.75% at the low end and 4.0% at the upper end of that best execution range. That marks the first time FHA mortgage loan rates have pushed into the four percent zone in quite some time (best execution). In spite of Monday and Tuesday, Wednesday saw rates once again starting to creep higher.
At the time of this writing, the closing bell has not rung on the markets for Thursday but it’s unlikely FHA rates would be affected so much that they could drop back into the old comfort zone of 3.75%.
That prediction is based on past performance, which does not guarantee future results. But it seems safe to say the range of rates is here to stay for a little while longer unless there is a more decisive move lower on the next trading day. Given that we’re heading into a holiday weekend and rates have traditionally been more “defensive” ahead of them, we might be looking into next week for any changes.
There’s a great deal of volatility at the moment–the Greek crisis figures largely into that, as do scheduled economic data release here at home such as the Employment Situation Report which came out on Thursday. So far the trend of the summer is upward, and “lock” is the advice many industry professionals are giving out in the current rate environment. Those who choose to float–to hold off on an interest rate lock on a mortgage in hopes that rates will move lower in the short term–do so at their own risk. If you can’t afford those risks, locking now might be best.
Please note–Best execution rates mentioned above may not be available from all lenders or to all borrowers. Your experience may vary depending on FICO scores, other financial qualifications, and the availability of a participating lender.
Do you have questions about FHA loans? Ask us in the comments section.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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