Helen asks…
Mortgage rates so low?
Has anyone else benefited from the government seizing Fannie Mae and Freddie Mac?
I am settling on my new house October 20, and when I applied for my mortgage about 1 month ago and decided to float the interest rate (rather than locking in 6.5% at the time). Today I was able to lock in 5.75% at 0 points!
When I decided to wait to lock-in, I was just hoping to get down to 6.25 or 6.125, so obviously I am thrilled with these results!
Has anyone else done just as well?
And what happens now? Do you think they continue to drop, or start to rise again?
answers:
They actually dropped Friday before the takeover this weekend. I’m not sure why. But, I’m in a similar situation to you and my loan officer called me Friday afternoon letting me know about the rate drop.
Good timing for us. Low house prices and decently low interest rates.
I think the rates will continue to fluctuate in this same area until the housing market turns around again.
Joseph asks…
what is today’s mortgage interest rate?
answers:
Typical around 6.5, but it depends on a lot of factors. Check bankrate.com
Jenny asks…
When average house prices are lower, are mortgate interest rates likely to be normally higher or lower?
I’m trying to find out whether or not mortgage interest rates are normally higher when house prices are low. When for instance, house prices were low in the 1970′s (UK), were mortgate interest rates far higher, slightly higher, the same or even lower compared to today?
Although of course there are many different conditions that effect mortgate rates, but generally would they be more likely to rise when house prices fall?
answers:
Depends on lots of factors but using pure economics you could assume:
When house prices are low, interest rates would also be low. This is because house prices would be low due to low demand for houses (high demand means house prices rise) therefore the demand for loans is low and the Banks must decrease interest rates to attract borrowers. The result should see an increase in the demand for houses as the cost of the loan is low and so price would start to increase.
Of course factors such as general economic cycle, unemployment, supply of houses and cash rate to the banks would impact as well.
David asks…
Why a higher interest rate on modular home mortgage?
We were hoping that building a brand-new modular home would be the answer to our VERY frustrating and discouraging search for a new home.
But when my husband called the mortgage company today, they really burst that bubble! They say the interest rate will be higher on a modular. We are not talking “doublewides” here… My husband and I really had our eye on a couple of higher-end models that look as good as any other house I’ve ever seen. Better, even!
So, why the higher interest rate? And how much higher would it be? My dear husband did not press her for answers, but I want to know. Thanks…
answers:
It’s my understanding that the rate can be as much as double, so, possibly, 12% or better. That’s because these homes don’t appreciate as much as a traditional home (the buyers market is smaller, there are still some people with negative feelings about modular homes), they can be moved (literally, someone could drive away with the banks equity), but most importantly, because there is a higher rate of loan default with modular homes. Why there is a higher default rate is immaterial. Statistically, the loan is higher risk than a traditional stick built home.
It’s still a secured loan though, so you won’t pay rates comparable to credit cards, for example. And, of course, the interest is still deductable.
Daniel asks…
I have a mortgage with Chase. How can I get help from the Fed to get lower rates, principal, payment?
I read today they are helping homeowners.
answers:
Phone the Fed and ask them to post you out some information on this.
Also ask them what banks they are working in conjunction with, to help homeowners, then phone the bank or go into that bank.
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