Mortgage Rates have Dropped Again!
At their last meeting the Federal Reserve voted to leave the key rate alone. Home mortgage rates actually more closely follow the 10 year bond rate than the key rate from the Federal Reserve. (This is because 30 year mortgage loans only last for an average of 10 years as owners sell their homes before the mortgage is paid off.) After the Fed meeting, the 10 year bond yield dropped 2.7 basis points.
As of the week of July 27th, 30 year fixed mortgage rates averaged 3.92 percent, 15 year fixed mortgage rates averaged 3.20 percent, and 5 year hybrid adjustable-rate mortgage averaged 3.18 percent, as reported by Freddie Mac.
Many buyers don’t stop to compute how much difference their payments can be on a small percentage rate difference. Over the life of a 30 year mortgage, the difference in a 3.92 percent rate and a 4.5 percent rate costs the buyer $30,481.20 in additional payments.
Eventually, mortgage rates will rise again. Now is a great time to buy that first home, vacation home, rental property, or retirement home.
If you are thinking about buying your next home, vacation home, or a home for retirement, please give us a call. Likewise, if you are thinking of selling your home, contact us. We will be happy to do a Current Market Analysis and let you know the price of your home in comparison to other homes that have recently sold.