August 22, 2015
Mortgage rates closed out the week by moving lower–some sources are labeling the current rates as the lowest in over three months. Rates edged higher ahead of the release of Fed meeting minutes, but every day after that (for three days in a row) there has been some form of improvement.
That three-day improvement helped bring 30-year fixed rate conventional mortgage loans back into a range of rates with 4.0% at the upper end of the range and 3.875% at the bottom end, best execution.
FHA mortgage loan rates, best execution, haven’t shifted out of the 3.75% comfort zone, but chances are good that if the improvement continues we’ll see FHA rates follow suit and move into a range of numbers with 3.75% at the high end.
Again, that’s assuming there’s more improvement to come. If rates move sideways on Monday it may take a while longer for FHA rates to “catch up” should improvement resume. FHA rates may vary more among participating lenders, so it’s best to compare offerings and that the best you can find. Remember, some day’s improvement in mortgage loan rates don’t result in a change of the best execution rate, but closing costs. Either way, it can be an advantage to the borrower.
Best execution rates, as described here, refer to interest rates offered to extremely well-qualified loan applicants with outstanding FICO scores and other financial qualifications. Your experience may vary due to a variety of factors including the availability of a lender willing to offer such rates.
When it comes to the “lock or float” question, some are saying in the current climate over the short term there may not be a “bad” choice to make–some want to lock in the current lows and stop worrying about it; others may feel that even better conditions could happen over the short term. It’s your choice to make; ask some advice of your loan officer and make the most informed decision 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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