October 1, 2015
It’s been a week full of downward movement for mortgage loan rates; Wednesday at the end of the market day rates were being reported in lows we haven’t seen for months.
30-year fixed rate conventional loans are in a range (best execution) between 3.75% and 3.875% at the time of this writing. We haven’t seen conventional loan rates come near 3.75% for some time now and if the downward trend continues we could see this range persist or move closer to 3.75% for more extremely well qualified borrowers.
FHA mortgage rates, which have long stayed in a 3.75% comfort zone, have finally broken out of that in favor of a range of best execution rates between 3.5% and 3.75%. Remember, FHA rates can vary more among participating lenders than their conventional counterparts.
“Best execution” refers to situations where a borrower with excellent financial qualifications is applying. Your FICO scores, payment history and other financial data will play a major role in your access to these rates. The availability of a participating lender may also be a factor. Your experience may vary.
The scheduled release of jobs data on Friday has the potential to either spoil this downward trend, or help it along. That factor, plus the current state of the mortgage rates in general being lower than we’ve seen since May, is prompting some industry pros to advise uncommitted borrowers to get a mortgage rate lock rather than “float”.
Locking or floating is the borrower’s call, but it’s good to know about scheduled events like the Friday jobs report that could affect which way mortgage rate trends are going.
If you aren’t sure about locking or floating, ask some advice of your lender and make the most informed decision you can. Your “risk tolerance” will be an important factor in that decision–how high can rates climb before you need to commit?
Do you work in residential real estate? You should know about the free tool offered by FHA.com. It’s designed especially for real estate websites–a widget that displays FHA loan limits for the counties serviced by those websites.
It’s simple to spend a few seconds customizing the state, counties, and widget size for the tool; you can copy the code and paste it into your website with ease. Get yours today: http://www.fha.com/fha_loan_limits_widget
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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