Mortgage rates dropped again, but the Mortgage Bankers Association reports an upturn in mortgage and refinance applications. Could this signal the end of the lowest mortgage rates in decades?
How low can you go?
Just when we thought mortgage rates couldn't go any lower, HSH Associates reports average combined rates for a 30-year FRM fell by two basis points to 4.78 percent. Rates for a 15-year FRM fell four basis points to 4.24 percent. Average combined rates for a 5/1 ARM also dropped four basis points to 3.73 percent.
Although low rates look like good economic news, most consumers remain reluctant to risk taking on long-term debt in a still-shaky economy. Reports of increasing mortgage applications may bode well for lagging housing markets, and could encourage a few wary consumers on the sidelines. With mortgage rates this low, buying a home can easily move to the top of your list of things to do.
Get ready to find your best deal on a mortgage loan
Impulse purchases are notorious for causing trouble, and buying a home without preparing is no exception.
- Consulting a financial advisor, evaluating your finances, and boosting your credit rating by paying off debt can help you qualify for a mortgage loan at today's low rates.
- Get help from a real estate professional: Buying your first home can be a complex and stressful process. A real estate pro can help you focus on affordable homes and neighborhoods suited to your lifestyle. Your real estate agent can help walk you through the process of making an offer, counter-offering, and buying and closing on your home.
- Shop for a mortgage before shopping for a home: Shop and compare multiple mortgage quotes. Ask questions, take notes, and don't be afraid to negotiate. Being pre-approved for a mortgage loan can enhance your buying power in situations where multiple offers are being considered.
- Think outside the box: If obstacles arise, talk with your real estate agent. If you're short of funds for a down payment and closing costs, consider an FHA loan, and look into first time home buyer programs sponsored by your state or community.
Our live database of current mortgage rates can help you find the best mortgage rates in your area.
