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Subscribe to RSSThe average rate for a 30-year fixed-rate mortgage has dropped to a record low 3.91 percent, mortgage giant Freddie Mac said Thursday.
That's down from last week's 3.94 percent, which matched the previous record low set in the fall, which was the lowest since records began being kept in the 1950s. The rate for a 15-year fixed rate mortgage was steady at 3.21 percent, also a record.
Rates may be low, but they haven't been able to spur sales for a number of reasons, including stagnant wages and persistently high unemployment.
Housing data has recently been showing some improvement lately. Sales of previously owned homes rose 4 percent last month to a seasonally adjusted annual rate of 4.42 million. That's below the roughly 6 million homes a year that economists say are consistent with a healthy housing market. But it's ahead of 2008's revised sales, now considered the worst in 13 years.
But applications for new mortgages fell last week as low rates were not enough of an incentive to spur demand. There's also a huge glut of foreclosed homes on the market and in the pipeline that continue to depress home prices.
The Freddie Mac benchmark is based on loans that included an average up-front fee of 0.7 percent of the loan's value on a 30-year loan.
The Associated Press contributed to this story.
Related story:
Housing market improves, but foreclosures spoil the party
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As everyone says they can go down to 1% and it won't make an iota of difference for sells--just refinances for those who are fortunate enough to be in a good spot at this point of the timeline of their lives. It's all about timing folks. Either your in the right spot or your not. Those less fortunate can just laugh about the rates they won't help them or the market.
doesnt matter...
I'd rather have a house at 100K at 15% vs a 300K house at 3%.
Homes are over-valued at current prices due to low interest rates and easy lending.
Who wants to borrow money for a declining asset that's hard to liquidate? Price (in this case the interest rate for mortgages) is set by supply and demand.
While a house has been a great asset over time, there are trends that may drive prices down further. As the baby boomers age, move into senior living and die, demand for housing may drop. The baby boomers have been the major influence over the last 60 years.
I don't live in one of those large cities and areas where housing is volatile. My house didn't go up in the boom or down in the bust. Only sales time has been extended in my area. But in places like NYC, Boston, Vegas, LA there have been severe swings. Where I live, a house is a place to keep your stuff. Price change doesn't mean much.
Did you realize that to pay for the payroll tax cut that President Obama wants so bad, they included into the law that anyone with a mortgage would pay more to fund the cut? I was told it would amount to about $17.00 per month for a $100K mortgage. Every American must be aware that the increase would never go away. While the cut might go away in a year, the tax increase would not. Maybe it's a good thing if Congress doesn't extend it. Could be cheaper in the long run for all mortgage holders.
Keep in mind that that provision was NOT in the House bill. The House was right to reject the Senate bill.
Sorry I was wrong, it was $17.00 per month on a $200K mortgage.
If you don't have a job, you can't buy a house. They need to work on JOBS first, then the housing market might start picking up a little bit.
This past election the tea baggers ran on the platform of jobs. Yet they passed more bills pertaining to women reproduction rights than they did on jobs. And the only way to be afford a house today is to have a job.
So tea baggers, why haven't you come up with a bill that would put people back to work fixing the interstructure of our country. Why haven't the tea baggers started to hold hearing on the tariffs, increasing the inspections of all the foreign made crap that is coming into this country?
What about your lame president who promised jobs and threw trillions of $ at it. Why hasn't he and his demotards in the senate fixed it? GET REAL!!!
@NVHUNTER:
Because the Republicans in Congress won't approve anything Obama proposes, and then blame him when nothing happens.
The best part is that their media machine has blinded you to this.
Number of Liberal Media outlets: 893
Number of Conservative media outlets: 6
James - And that is why you are destined to remain poor. For the numbers you used the house payment would be less than 40 CENTS difference (based on P&I). However, by the time that the house is paid off the $100K home @ 15% would have paid over $355K in INTEREST. But the $300K home @ 3% would have paid $155K in interest. All told, you would have invested almost exactly the same amount but you would still have a home worth 1/3 the other - despite any appreciation or depreciation.
Don't confuse him,he thinks it's Bushes fault that a 100k house is worth less than a 300k house anyway.
Pickled: you picked the right moniker...your numbers are absurd.
Ugh...I wish this was a couple years from now when my student loan debt was paid off.
what was the interest rate for your student loan? I have some @6.5% and some @ 8%....what a scam
For an unsecured loan with no collateral that sounds like a pretty good rate to me.
The rates don't matter when most people don't have jobs that pay enough to afford them and charging for education is a bad idea anyway.
@Mr: Warmth:
Anywhere from 3%-8%. They are adjustable rate, but I don't see the Prime Rate going up any time in the near future.
Knight, ever given thought that maybe your degree isn't worth the paper it's wrote on? There are good jobs out there, if you had an EE degree you would be working. Basket weaving and liberl arts degrees, good luck with that. Too many people thought a degree would mean a job. Well it will, if it's in the correct field.
The one's who got degrees in the simple, so to say, careers, well you know realize after the fact, you screwed yourself.
SallyAnn - You should seriously consider a refund on the investment in your degree.
Knight: MOST people don't have jobs? You seriously aren't good with numbers.
Evil Business Owner
For an unsecured loan with no collateral that sounds like a pretty good rate to me.
The loan is not unsecured. I have to guarantee the student loans for my kids. Do you have kids in college?
With all the uncertainty in the direction of where this country is headed, the do-nothing posturing in government, absolutely nothing being done about the national debt, no serious talk about reforming a f##ked-up tax code, outright media lies about REAL unemployment numbers, falsehoods about the housing market,... stuck in the twilight zone about what Obama Care means for small businesses, no sensible energy policy, you can drop mortgage rates to 0% and it won't stimulate folks into buying. In other words... gridlock in Washington/political manuevering due to an upcoming election...2012 will be complete and utter stagnation. Everything depends on how the election pans out.
Mortgage rates are too high! Instead of 4.0% make them -4.0%. Come on Bernanke and Geithner, you can make it happen. Just erode our purchasing power some more.
We paid off our home about the same time as this craziness began. One week after sending in that final payment the "nice" man from BofA called me to ask if we'd like to take out a HELOC. I told him that we'd just gotten their grubby little paws off our home and that I would most certainly NOT be interested in doing anything that would allow them to make another dime from us.
We didn't originate with BofA; our bank was sold 3 times and they wound up with our paper. And it was truly awfully trying to get those release papers from them; it took 6 months and 2 threatening letters before they sent them. But they can know our house is paid for and call to offer us other services. Service *this* BofA!
BofA is a bunch of criminals in nice suits. Good thing you told them to f'off. Don't give these guys one red cent.
meh...yeah...saw the writing on the wall 3 years ago. Did whatever I had to to pay off mortgage. It's like new car payments; NEVER AGAIN!
I could pay my house loan off, but use it as a tax deduction. It saves me money, and gives me a chance to make money off of what I would spend paying it off. But I agree, if you don't need the deduction, pay it off.
I purchased a piece of property and will eventually build on it. I would like to borrow the funds now at the low rates, but builders in my area still want to charge a fortune for labor as they did during the boom years. I'm not willing to be underwater on a new place before I begin, so I'm waiting for labor costs to come back to realistic amounts. Builders need to remember that the cost of land + labor + materials can't equal more than the house is worth. The high $ they made during the few years of the boom market may never come back and at this point they are their own worst enemy if they aren't working.
Yep, we're in exactly the same position. The bank advised us that we should just wait, and that we probably wouldn't even qualify for a loan since the house would cost more to build than it would appraise for. The lot is in a great location, but at this point, I feel like selling it and letting it be another person's problem.
Sorry to hear that your projects aren't working out for you. I closed a couple of investment accounts this summer right before the big crash. I bought some land with some of it and put the rest aside for later. Then we started looking for a good custom home builder and found one. I just got the appraisel back the other day and the land was appraised at 30% more than I paid. The house came in about 15% higher than it's going to cost to build. Now the interest rates are going lower? I hope this isn't just a dream because my luck isn't usually this good.
Hm, don't hold your breath. Minimum wage has increased without any justification, which drives up the cost of labor. Generally, this is accompanied by inflation but not enough this time.
For contractors to charge less to build a home, either the cost of labor or materials must decrease. Neither, looks likely.
However much builders like to build, they can't do it at a loss, very long.
Be wary of any who claim they can.
I'm not holding my breath, that's why I'm getting while the getting is good. The mortgage process is a lot more involved than it used to be but that is probably a good thing. I had all but given up on the idea that those of us that did things right by not buying into the housing bubble and living within our means would be rewarded. I actually made money on my previous house and it was only on the market for a month before it sold. I do know that the prices were way over priced based on the level of discounts that I'm being offered now.
guest-2010895 I'm going through the same thing. I looked at property today thinking about building but the cost of building is now more than buying an already existing home. I can purchase the exact home 2 years old for 70k less! That's nuts. I've rehabbed one home and built another. I don't think I would build again in this market. I am however looking at a rehab.
Another major problem is getting the bank to reply to an offer in some sort of timely manner. In Fl. buyers are walking away because the banks are taking too long. Sometimes it's 3 mos or more. I've looked at no less than 6 homes that the bank lost a sale on because they didn't speed things up. In that time the home is vandalized and the a/c units stolen ect. It just doesn't make sense.
I'll wait a while longer. When lenders begin paying interest to borrowers I'll apply for a mortgage loan .
2 years and I will own mine outright. I will buy a new car though, I like having a big truck for the work. But want a small gas miser to roll around in.
Nothing in the U.S. will get better until we kick out a bunch more liberals and rid ourselves of the latest STD, Obumbles and his band of crooks. He maxed out in Chi-Town organizing slums, errrr, communities.... Never in my lifetime did I think the country would be stupid enough to elect another "Dimmy Cawter." Of course, liberals know best.. Hillary must have a drink or two and laugh her ass off!
Go give your preist a hand job neo con.
Yeah this mess all started in 2009, damn the EPA for tanking trillions of dollars in bad unregulated and unmonitored loans made globally by banks. Obama tries to sacrifice a baby every day to make it worse but apparently the brilliant oompa loompa of the house is counteracting satans evil might.
knightofdespair: apparantly you just woke up from a coma two and a half years ago? You missed a LOT...(while you were out of it, your guy launched two wars off the books, spent like a drunken sailor and took this country to the brink of financial collapse. No wonder you're a little confused!)
It must be nice that in your befuddled mind you can ignore all the facts. Bush cut taxes for the rich, they created no new jobs instead America lost Millions Of Jobs under the Bush administration. And that was in spite of starting 2 wars which usually bringsprosperity America went down hill. Bush losing more and more jobs, 2 wars costing us Billions in cash and natural resources. To make up for the lack a revenue Bush borrowed trillions of dollars. Bush built up a debt that has no end, the GOP wants this country to self destruct that is why the Republicans just refuse to vote for Obama plans to help the country. And in spite of all the Republicans NO VOTES the President as been able to improve the economy, just a little, not a lot, but enough to show he is on the right track. The chose is clear, elect Obama Again or go back to a place worst that were bush left us. If the Republicans win I se revolt and martial law, a bad time in America. What do people do when they have nothing left to lose?????
Okay so now everyone who is in a home upside down or otherwise should be able to re-fi at this rate. Regardless of history of the loan or credit. THAT will stimulate the economy.
For most people refinancing adds $10,000 that either gets paid in cash or on top of the loan, plus banks are refusing to rewrite loans that are double the value of the asset (anymore, the spoilsports).
So, your solution to the housing crisis is that even if people can't afford it, they should get another chance to default on their loans? Oh yeah, that'll stimulate the economy!
I think the banks should write down the principal of the mortgage to what the current houses' values are if they are about to be foreclosed.
Banks get nothing from foreclosing, at least this way they'll get something, and the residents will still get to keep the house.
Ruken - So, if I borrow $100 from you and then tell you well today that $100 isn't really worth that much so I'm only going to pay you back $75 you would be okay with that eh? Why does someone else have to eat the loss when the person who signed the contract made a legally binding agreement to pay back the money they borrowed? After all they DID get that money and they DID spend it and they DID get what they paid for. The fact that later that investment wasn't as good as they hoped doesn't change any of that.
If you buy a stock for $100 a share and it drops should the company then buy that stock back from you at the price you paid? If that's the case then you should give them some of the money you make if you sell the stock when it goes up as well.
No it makes sense to take back what was bought and sell it for $10 instead, like banks are doing now.
If they could even get the $10. Often the banks themselves even walk away from the homes they foreclose on.
This slow housing market at these interest rates tells the REAL unemployment numbers
Why not visit a Cash for Title business operating in your local abandoned gas station building and pick yourself up a $ 3,000 one week loan at 300 % interest, buy your family expensive Christmas gifts including a new SUV for your teenage daughter and one for your wife (who is cheating with your neighbor and about to divorce you)...skip your mortgage payments this month...then loose both your home and your old loan car by the third month...and its all legal...and stupid...Guess what?...Pelosi and Reid and Franks are screwing you and not even laying a hand on you...Hows it feel?
Just like the previous administration did. Did you enjoy that? And McConnel, Boner and Cantor aren't screwing us now? GZ get a life, will you?
It feels like a bunch of professional politicians have taken over our political system and no matter what side of the aisle they are on they have only one TRUE interest - keeping their jobs and their perks.
We need to vote every incumbent out every election cycle until we get people back into the government who are interested in serving America instead of being serviced BY her.
Even with a job, very little debt and an honest credit rating I still can't get a home loan not even for a bank owned foreclosure sale.
They can lower the interest rates all they want but if the banks refuse to make loans this housing maket will only deeg deeper and prices will fall lower.
The bank bail out (with no oversight) was a real good deal....for the banks at US tax payer expence.
Good job...President Bush !
First of all, it all depends on WHERE you are. I went in just to "play the game" and I was approved for a new home loan in 2 days and I currently have a mortgage and am middle class.
Second remember that the bank bailouts were LOANS which have and are being paid back. It was pushed by liberals as much as anyone and is still praised by them as having stopped us from going into a depression. The stimulus on the other hand was a direct hand out/charity/vote buying scheme with no intention of ever seeing that money again.
Now ask yourself, what has happened to the money from TARP that was paid back? Do you think the Congress and President over the past 3 years have been paying that money back to where it came from?
Yeah jj, I bank at citibank and was offered a loan to buy ten houses. It's not hard to get a loan when your banker feels secure.
And the repaid tarp money, um, anyone have any idea where it went?
Strange they don't mention that two of the biggest reasons that people aren't buying houses is that 1) home prices are still falling in many areas and 2) there is still a glut of foreclosed homes which are being held back from the market (through private and government interference).
Keep in mind that during NORMAL times the foreclosure rate is between 2-4% of the market. Right now it is around 6-8% which means about 4% of the market currently in foreclosure or going into is is because of "unusual" reasons. That still leaves over NINETY-PERCENT paying their mortgages and building equity io their homes.
What Bank of America has done is simply replace one form of taxpayer sponsored capital (TARP) with equity and another form of taxpayer sponsored capital—loans from the Fed. Those loans carry super-low interest rates, so they'll help Bank of America make more money at taxpayer expense. Those loans also, importantly, come with NONE of the restrictions that TARP does.
And taxpayers are on the hook every bit as much with the Fed loans to Bank of America as they were for the TARP capital. The only thing that has changed is that taxpayers don't have any control anymore. Bank of America can now take that money and do whatever it wants with it, including paying out tremendous bonuses for making stupid loans.
JJMurray:
You do not have a damn clue as to what you are talking about.
I woul;d urge you to learn the whole facts consering the bank bailout and the TARP bailout.
In the end it was "free money' that will never be returned to the US tax payer.
Mr. Nice - Perhaps it is YOU that should check you facts: http://www.tarppayback.com/
The TARP money IS being paid back. Next time before you start spouting off and swearing at people it would help to do some research so you don't like like a total fool...to late this time though.
JJ....Did you read what I said? Tarp being repaid buy more tax payer's money via low interest loans which they (BoA) are not required to repay.
Get a life...wake up...pull your head out of your arse.
Your "referance" is nearly a year old....to the day.
Yes Mr. Nice I DID read what you said, apparently YOU didn't.
"...loans from the Fed."
You DO understand what a LOAN is right? That is money that must be paid back. If the interest rate is low or high that means that MORE gets paid back than was borrowed. As for you idea that they are "not required" to pay back these new loans, please provide a link to verify that.
This quote is from CBS News/AP:
"(AP) Bank of America Corp. said Wednesday it plans to repay its $45 billion in government bailout funds in the next few days, a move that will help the troubled bank recruit a new CEO.
The bank said in a statement it would use available cash and raise $18.8 billion in capital to repay the money, which it received during the height of the credit crisis last year and after its purchase of Merrill Lynch & Co. earlier this year."
As for heads and arses - The date on the reference I gave you is Friday, January 14, 2011. So once again, I urge you to stop making yourself look even more foolish than you already do.
this market I tyred to re-fiance my home to lower the interest rate with appraisal 2 times what I wanted to refinance and enough money invested to pay it off 1.5 times. I also have 2 rentals that are payed for that =1,5 times the amount I waned to refinance. I could not get it refinance not enough collateral and told the best thing to do was sell to a developer.
Could get a FHA loan with mortgage insurance but that would cost around $6000.00 no way that would eat up the lower instrest rate fro 5 years.
Banks only lend money to people who don't need it!!!!!!!
Trying to
Banks should hold "House Lotteries" for their customers to win and at least get some good out of the defaults!
All americans should be able to borrow the first $100,000 for a home to live @ 0.500%
Wow first time home buyers have hit the jackpot with ultra low rates and rock bottom house prices. Lucky them.
Credit scores and this are a joke of paradoxicality. You have no money so you need more but you can only borrow at high interest rates because you are poor and have a poor score. Low interest rates on houses only benefit the lucky ones who are employed or the wealthy ones who can refinance at low rates. Nothing helping the 25 million unemployed. keep things this way and employ the 25 millions unemployed and now we're talking about a moving economy. but that won't happen because if unemployment was reabsorbed, then rates would go up which tells me this society is set up on a minority losing out somehow somewhere. The reverse image of CEO getting paid exhorbitant salaries.