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Best Mortgage Rates Continue To Dance Around 5.00%Best Mortgage Rates Continue To Dance Around 5.00%

Posted by  on Sep 04, 2009
 

Lowest Mortgage Rates Dip Below 5.00%, Then Climb Back Up

During the third week of July, many hopeful speculators were pleased to see mortgage rates finally break the 5.00% barrier after several increases during the last two months. But while interest rates improved during the middle of the week; by Friday, rates were back up in the low 5.00%. Most recently, current mortgage rates for 30 year fixed home loans now range from 5.00% to 5.25% for the most qualified borrowers. Most mortgage lenders define the best borrowers as individuals with credit scores above 740, loan to value ratios below 80%, and have assets to protect them from financial emergencies.

How Should You "Play" the Current Mortgage Market?

Well, since even the best mortgage lenders are susceptible to volatile mortgage market trends, you might want to play it safe and lock your rate as soon as you can. For most homeowners, this is generally sound advice which most mortgage brokers will typically support. Playing the mortgage rate watching game correctly can pay off and make for great water-cooler bragging rights, but the consequences can often be more troublesome.

On the other hand, recent housing market predictions have played a significant role for interest rates, and many speculators are still waiting to see if interest rates will continue to drop even further. The most common economic data affecting mortgage rates ranges from unemployment rates, government announcements, consumer confidence, to recent home sales activity. In general, poorer economic data typically results in mortgage rate improvements--and many analysts expect to see weak economic data to continue in the near future.

Whether you're comparing mortgage rates for a home loan refinance or for the purchase of your first home, deciding to float or lock your interest rate will depend on your specific timeline. Some buyers may only be shopping and can afford to see where mortgage rates go, while homeowners with an adjustable rate mortgage may need to refinance before their monthly payment skyrockets. In either case, your mortgage lender, or broker, should be able to help you decide how to deal with current mortgage rates.

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