December 3rd Best Mortgage Interest Rates and Lock Recommendation
By: Freeman Liz
November 30, 2009
| Program | Rate | |
| 30 Year FRM | 4.78% | Worse by .03 |
| 15 Year FRM | 4.09% | Worse by .03 |
| 5/1 Year ARM | 3.91% | Worse by .06 |
| Jumbo 30 Year FRM | 5.98% | Worse by .06 |
Here is today's look at best mortgage rates, (which do not include discount points, origination points, or loan level risk based price adjustments) provided by Mortgage News Daily, Freddie Mac, and other sources. Note that Freddie Mac's AVERAGE rates are typically higher than BEST rates, because average rates include surcharges for risks associated with property types, down payments, and credit scores. To be eligible for BEST rates, borrowers need spotless credit (740 score or better), a sizable down payment (20-25%) or equity amount, and stable, adequate, and documentable income. In addition, the property must be located in a healthy (not declining) market and must be conventionally built.
*** LOCK ALERT *** RATES WORSENING *** Mortgage interest rates are INCREASING and if you still haven't locked your interest rate you probably should.
Lenders are increasing mortgage pricing in anticipation of an unfavorable unemployment report tomorrow.?? Preliminary data released today foreshadows what could be a decrease in unemployment, which if large enough could move markets very quickly.
Today's economic news was mixed. The 3rd Quarter Productivity revision gave us a lower level of productivity than?? forecasted. The 8.1% annual rate of worker productivity growth is bad for bonds and mortgage-backed securities (MBS) because the?? estimate was 9.5%.
The Labor Department also gave us more bad news for MBS. Reports that 457,000 new claims for unemployment benefits were filed last week have made traders nervous about what tomorrow's monthly employment data will show. Because 480,000 claims were expected and only $457,000 were filed, the employment situation may be stronger than thought--always bad for bonds and MBS.
If closing in the next 30?? days I would LOCK my rate. Otherwise, I would FLOAT my rate. This is only an opinion--what I would do if I were closing a mortgage at this time. Your decision may depend on other factors such as the strength of your loan approval and your tolerance for risk, and must be made with those in mind.
Liz Freeman has more than a decade of mortgage lending experience. She writes about mortgage and finance issues and is a regular contributor to Mortgage News Daily.
