July 7, 2015
We’ve been watching as mortgage loan interest rates overall have moved higher this summer; the upward trend brought 30-year fixed rate conventional mortgage loan rates back into the low four percent zone, best execution.
The FHA mortgage loan interest rates followed suit, but only very late in the trend–we recently watched as FHA mortgage loan rates broke out of the previously long-held 3.75% comfort zone and into a range of best execution rates with 3.75% at the low end and 4.0% at the high end.
Greek economic headlines have been responsible for at least some of the volatility in recent weeks, and in light of Sunday’s referendum voting No in regard to a set of changes proposed by its creditors in the Eurozone, the fact that Monday’s rate behavior took a decisive move lower shouldn’t be any surprise. Bad economic news or news that could be perceived as being bad for the economy often results in lower mortgage loan rates.
Investor reaction to the Greek debt crisis headlines on Monday did help bring rates lower. 30-year fixed rate conventional mortgages had flirted with 4.25% at the end of last week (best execution) but rates are returning to the bottom end of the four percent zone. FHA mortgage loan rates have not moved out of their best execution range with 4.0% being the high end, but if the downward movement continues it’s likely the current range might disappear in favor of something in the high three percent zone.
As always when we discuss these rates, we are talking about best-execution numbers which assume ideal conditions. Your access to these rates depends on your financial qualifications and the availability of a participating lender willing to offer them. Your experience may vary.
Could rates continue to move lower? It’s hard to say–international headlines can and do influence the rates, but for how long in this particular case is anyone’s guess. Make a very informed decision about floating in the coming days–don’t assume rates will continue to move downward just because of a stronger day at the beginning of the week. Some industry pros are advising borrowers who are within 30 days of closing to go ahead and lock, but borrowers should be prepared to make the most informed choice in this area that they can.
Do you have questions about FHA 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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