October 12, 2016
Mortgage loan interest rates have been in a short-term trend with no improvements and/or upward movements for well over seven business days.
Some market watchers believe this trend will persist a bit longer, and even though the highest rates we’ve seen in the trend are still considered low compared to previous years, it makes for a difficult choice for any borrower on the fence about locking or floating.
30-year fixed rate conventional mortgage loan interest rates are still within a range between 3.5% and 3.625%, but there are far fewer lenders offering the bottom end of that best-execution range. 3.625% is far more common, best execution. As upward pressure continues (assuming it WILL continue in the short term) we will eventually see that range disappear in favor of the higher rate.
FHA mortgage loans are still holding in a best execution 3.25% depending on the lender, but how long will it take steady upward pressure to push that into a range of rates with 3.25% at the bottom of the range? FHA rates tend to vary more among lenders and your experience may vary; it’s best to shop around for the most competitive rates.
(Best execution rates like the ones listed here are not available to all borrowers or from all lenders. Your ability to access rates like these depends greatly on your financial qualifications including FICO scores, loan repayment history, etc.)
In the short term, those who have not entered into a mortgage loan interest rate lock commitment with the lender should heed the advice of market watchers who say floating in the current rate environment is a risky proposition. In an upward trend, holding out hope for rates to suddenly move lower is a gamble. Floating is never without risk, but right now the risk for higher rates seems elevated based on current performance over the last nine days. Get some good advice from your lender before proceeding.
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.
Browse by Date: