September 16, 2015
You may notice us posting more this week about FHA loan interest rate trends; that’s because this is a major week for mortgage loan rates since the Fed announcement due Thursday on a possible interest rate hike is a major news item.
Yesterday we reported that it is very likely that rates might go into a holding pattern ahead of the Fed, but as anxiety builds, investor behavior is putting upward pressure on the markets that directly affect mortgage rates.
On Tuesday rates moved higher, pushing many lenders aggressively offering sub-four percent rates on 30-year fixed rate conventional mortgages (best execution) back into the 4.0% zone. Some borrowers may have noticed the difference in closing costs rather than an actual rate move depending on the lender.
FHA mortgage loan rates remain in the long-held best execution comfort zone of 3.75%, but remember that FHA rates can and do vary more among participating lenders and your results may vary. Best execution rates in general are offered to those with outstanding FICO scores and other financial qualifications–they are not available to all borrowers or from all lenders.
The advice you’ll read ahead of the Fed announcement on Thursday? “Lock” is a prominent word–floating or holding out on a mortgage loan interest rate lock agreement between you and the lender carries an elevated risk this week.
Floating is never risk-free, but with the Fed poised to make a statement about if/when interest rates might be hiked, the potential for mortgage rates to rise is high depending on investor reaction to the announcement. Float at your own risk, but whatever choice you make, do it with as much information and good advice as you can.
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 is easy 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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