May Interest Rate Update for Frederick Buyers
Interest rates are staying low, under 5%.
as of 05/04/2011 09:00 AM Eastern
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| Product |
Interest Rate |
APR
|
Conforming and FHA Loans
|
| 30-Year Fixed |
4.750%
|
4.939% |
| 30-Year Fixed FHA |
4.625%
|
5.657% |
| 15-Year Fixed |
3.875%
|
4.195% |
| 5-Year ARM |
3.000%
|
3.170% |
| 5-Year ARM FHA |
3.375%
|
3.373% |
Larger Loan Amounts in Eligible Areas
– Conforming and FHA
|
| 30-Year Fixed |
4.750%
|
4.886% |
| 30-Year Fixed FHA |
4.625%
|
5.600% |
| 5-Year ARM |
3.125%
|
3.167% |
Jumbo
Loans – Amounts that exceed conforming loan limits
|
| 30-Year Fixed |
5.125%
|
5.264% |
| 5-Year ARM |
3.625%
|
3.343% |
A note about rates: Mortgage rates are a moving target. A lender recently told me that in the month of April, lenders issued 1.7 rate sheets per day. This means that mortgage rates changed every 4 hours, 42 minutes on average. Unless you are locked in at a rate, your rate quote from last week or even yesterday is probably not accurate.
I was curious why they change so often; this is what I was told:
Your lender's price is directly
tied to the Wall Street-pricing of something called a "mortgage-backed
bond", a bond that's backed by a group of U.S. mortgages. Like
everything else in finance, the price of these mortgage bonds is based
on supply and demand. Bond sellers make supply. Bond buyers make demand. At
any given moment, the ratio of sellers-to-buyers is in flux. Sometimes,
buyers outnumber sellers and bond prices go up. Other times, sellers
outnumber buyers and bond prices go fall. These shifts occur all day long and when the shifts are "big" -- a relative term if there ever was one -- mortgage rates change.
Thanks Mike G. for the explanation. The lesson is, when your lender suggests you lock in on a rate, don't sleep on it, act on it.
_____________________________________________________________
_________________________________________________________
The Highland Group
Chris & Karen Highland * 301-831-9947
Turning Point Real Estate – 301-831-8232
email us: isell4u2@msn.com
Text Us: 301-401-5119