December 29, 2015
Mortgage loan rates are being reported in “holiday mode” at present, so while there was some very minor adjustments for the better in rates, we’re not likely to see much in the way of dramatic movement this week barring some form of breaking news that causes a significant investor reaction.
As we move from one short week to another before the new year, there is lighter activity in the financial sector, things slow down, and investor behavior tends to reflect this winding-down time, so it’s no surprise that the word “float” is being used a lot when it comes to advising borrowers on getting a mortgage rate lock or not this week.
Many industry pros feel floating carries a smaller degree of risk than it did previously due to the holiday season’s slower pace–floating is never risk-free, but right now there does not seem to be as much danger as there was only a couple of weeks ago before the Fed announcement about interest rates.
At the time of this writing, 30-year fixed rate conventional mortgages were reported at between 4.0% and 4.25% best execution. FHA mortgage rates are still in a best execution comfort zone of 3.75% though you may find greater variation among lenders.
These are the best execution rates published at the end of the trading day on Monday, but we’re not likely to see much change until the start of the new year when scheduled economic data releases and other factors resume.
As mentioned above, breaking news is always possible but without that “x-factor” borrowers may feel more confident to float this week. Always ask the advice of your lender before committing to a lock or float, and make the most informed choice possible.
Do you work in residential real estate? You should know about the free tool offered by FHA.com. It is designed especially for real estate websites; a widget that displays FHA loan limits for the counties serviced by those sites. It is 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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