December 13, 2016
Mortgage loan interest rates have been in an upward trend for some time now; since our last report we saw rates hit two-year highs once more on Friday only to recover a little come Monday.
In days past we’ve seen overseas issues such as the European Central Bank’s policy announcements play a partial role in the investor reactions that caused some of the upward pressure on rates, but also bond market issues and jitters over economic issues related to politics.
These factors, combined with the potential for the Fed to announce an interest rate hike, and it is no surprise that we’re in an upward trend at the moment.
30-year fixed rate conventional mortgages are reported, at the time of this writing, in a range between 4.125% and 4.25% (best execution). Monday’s small improvements may result in affected borrowers seeing alterations in closing costs rather than actual interest rate numbers, but any improvement in the current rate environment is welcome.
FHA mortgage loan rates are still holding at or near 4.0% best execution. That rate may vary more among participating lenders than conventional mortgages, so it pays to shop around for the most competitive rates and terms.
As always, the numbers reported here are listed as best execution, which assumes an ideal borrower with strong FICO scores, loan repayment history, etc. Your financial qualifications will play an important part in determining the interest rate offered to you. The rates here are not available to all borrowers or from all lenders, your experience may vary.
Industry professionals are still using the word “lock” in their advice to borrowers who aren’t sure whether to make an interest rate commitment with the lender yet or not. Floating-holding off on this commitment in hopes that rates will go back down-is never without a degree of risk, but in the current rate environment the risk is definitely elevated.
Speak to your loan officer to get some good advice about the current rate trends before choosing to float-you’ll be glad you did.
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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