Princeton Capital Blog

Mortgage Rates Hit New Low

November 16th, 2012

Mortgage Rates Hit New Low

Both 15-year and 30-year mortgage rates have hit a new low.  This is in part caused by the large sell-off of stocks last week, and people are parking their money in Treasurys.  Secondly, in the aftermath of Superstorm Sandy, there were fewer people filing for loans.

 

From CNN Money:

Mortgage rates dropped again this week, sending both 15-year and 30-year fixed-rate loans to record lows.

According to mortgage giant Freddie Mac, the average rate on the 30-year fell to 3.34%, 0.06 percentage point lower than last week. The 15 year fell 0.04 percentage point to 2.65%

“[The storm] had a significant impact on application volumes on the East Coast,” said Mike Fratantoni, MBA’s Vice President of Research and Economics. “Applications fell more than 60% compared to the prior week in New Jersey, almost 50% in New York and nearly 40% in Connecticut.”

Record low rates have made mortgage borrowing cheaper than even just a year ago, when rates were thought to be extremely favorable. At the time, 30-year loans had rates of about 4%.

A homebuyer today would save about $27 a month for every $100,000 borrowed, compared with last November. That’s a savings of $486 a year on a typical mortgage balance of $150,000.

The Wall Street Journal weighed in as well:

For the week ended Thursday, the 30-year fixed-rate mortgage averaged 3.4%, compared with 3.39% the previous week and 3.99% a year earlier.. A year ago the 30-year fixed rate hit 3.99%, falling below 4% for the first time since Freddie began providing its weekly update in 1971, the company said.

Rates on 15-year fixed-rate mortgages averaged 2.69%, versus 2.7% a week earlier and 3.3% a year earlier. Five-year Treasury-indexed hybrid adjustable-rate mortgages, or ARMs, averaged 2.73%, compared with 2.74% the previous week and the 2.98% a year earlier. One-year Treasury-indexed ARM rates averaged 2.59%, compared with 2.58% the prior week and 2.95% a year earlier.

Changing from a 30-year to a 15-year will save you a significant amount in the long term, and now may be the time to refinance.  Contact your local mortgage broker and set up an appointment to talk about your specific situation.

Princeton Capital

Contact Us

Top Work Places 2014
BBB