August 1, 2015
Mortgage loan rates have been in a recovery mode of sorts over many days–tiny increments of rate improvements have brought closing costs down over time but the basic best execution rates we’ve been reporting on here haven’t changed–until Friday, when a weaker-than-expected jobs data report brought a more dramatic move lower for mortgage rates.
The move was sharp enough to pull both conventional 30-year fixed rate mortgage loan interest rates and FHA loan interest rates out of their previously reported best execution range of rates and back into a single number on Friday. Conventional 30-year fixed rate mortgages are now reported at, best execution, 4.0% with some more aggressive lenders offering borrowers with the best FICO scores and credit histories rates in the high three percent range.
FHA mortgage loan rates dropped the range in favor of 3.75%, which puts FHA rates in line for best execution rates moving back down towards the previous, long-held 3.5% assuming the downward trend continues. There are many factors which may or may not influence that to happen. Next week there are several opportunities for rates to be affected by domestic economic news, and that potential means rates could move back into their previously reported range of rates if the data isn’t favorable to mortgage rates.
Remember, the numbers we’re quoting here are best execution numbers–your FICO scores, loan repayment history and other factors will determine your access to these rates. They are not available from all lenders or to all borrowers and your experience may vary.
Industry professionals say now is a good time for those who close soon to consider getting a mortgage rate lock rather than floating. There are those previously mentioned variables next week–two economic data reports on Wednesday and an employment report on Friday–that could affect rates for the better or for the worse depending on investor reaction to those reports. It’s easy to see why some industry pros are hawkish on locking in the short term since rates are better than they’ve been in about two months.
Do you have questions about FHA home 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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