November 26, 2014
FHA home loan interest rate trends this week include a fairly steady drop in mortgage rates, pushing conventional loans into sub-four percent territory in some cases and FHA mortgage rates down into a previously held comfort zone.
Last week, 30-year fixed rate conventional mortgage loan rates were at a best execution average of 4.0 or higher, but the downward movement this week sent those best execution numbers to an at-or-sub-four percent range. There’s greater variation among conventional lenders this week and not all the improvements are offered by all financial institutions.
What’s more, when it comes to FHA mortgage loan rates, at times we don’t see those rates changing as quickly as their conventional counterparts. But this week, FHA rates managed to react in the borrower’s favor.
We are now seeing best execution FHA mortgage loan interest rates move back to a long-held 3.5%–that was the comfort zone for FHA rates before upward pressure forced a range of numbers with 3.5% at the bottom end of the spread, best execution (FHA and conventional interest rate numbers we mention here are best execution rates and may not be available to all borrowers or from all lenders. Your FICO scores, loan repayment history and other factors may affect your access to them.)
It’s not certain whether the current rate trends will survive the holiday break. Thursday is a holiday and Friday is only a half day for markets, which means we may have to wait until Monday to see if we’re in a persistent downward trend on the short term.
Some industry pros are advising borrowers to float over the weekend and try making an interest rate commitment on Monday, but this is a choice that only the borrower can make–lock or float, make the most informed choice you can and ask a lot of questions along the way.
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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