Mortgage rates decline from record highs
A combination of mostly less-strong economic data and new troubles in the Middle East saw investors push more cash back into bonds, driving interest rates lower and trimming the top off the steep rise in mortgage rates from two weeks ago.
World troubles help mortgage borrowers
Troubles around the world can be a mortgage borrower’s friend; this happenstance has been repeated time and time again.
For example, financial troubles in the Eurozone both last and this year were one of the reasons mortgage rates pushed to near 60-year lows, as investors looks to get their holdings out of harm’s way and into the relative safety of U.S. Treasury offers.
Arguably, mortgage rates would have settled back somewhat despite the new political and perhaps military concerns in the Middle East, as available data continues to point to an economy enduring fair growth, but that which seems to be coming in fits and starts.
Rates down off two-year highs
- 30-year fixed-rate mortgages: Declined by seven basis points (0.07 percent) to 4.68 percent, easing back from last week’s two-year high
- 15-year fixed-rate mortgages: Slipped by just four basis points (0.04 percent), landing at 3.76 percent for the week
- FHA-backed 30-year fixed-rate mortgages: Shed 10 basis points, sliding to 4.26 percent
- 5/1 Hybrid ARM: Moved by a one one-hundredth of a percentage point to 3.41 percent for the week ending August 30
Mortgage-rate roller coaster
Mortgage rates continue to pogo stick, fully dependent upon:
- The vagaries of incoming economic data
- Concerns about what the Fed will do; and of course,
- The difficult political environment unfolding in the Middle East
Relative to early this year, we have had considerably more volatile mortgage markets over since mid-May, and the pressure for mortgage rates remains generally in a more upward than downward fashion.
When mortgage rates fall, act!
Any dips in mortgage rates are an opportunity for borrowers to act, most particularly for any homeowners who have been waiting for their situation to better align with a refinancing chance, but also for potential homebuyers who are in the fray at the moment and hope to capture even a slightly smaller monthly payment.