Mortgage Rates at Lowest Level Since May - How It Helps You
When the federal government took over Fannie Mae and Freddie Mac, one of the reasons was to take pressure off rising mortgage rates. Rate cuts from the Federal Reserve for short-term funds were no longer having the desired affect.
On Monday, we reported that the 30 year fixed rate mortgage stood at 6.08%, down from 6.26% a week earlier. The rate reported tonight by www.bankrate.com is 5.79%. This is the lowest rate since May. An article in USA Today this morning stated that calls to mortgage brokers from buyers have increased dramaticially over the past few days.
What’s The Affect Daytona Beach Real Estate Buyers
The recent drop of 0.6% means that your monthly mortgage payment will be less, or you can buy more house or condo for the same amount of money. On a $200,000 mortgage, the payment difference between 6.4% and 5.79% is $1251-$1172 or $79 less a month. For a payment of $1251 at 5.79%, you can buy a Daytona Beach home worth $214,000 rather than $200,000 at 6.4%.
The choice is yours, you can pay less or buy more for the same payment. In either case, you win if you have been waiting to buy a home.
We believe that in the long term, rates will increase unless further artificial measures are taken to keep the rates down. There is little that we can do about that, all we can do is take advantage when the situation presents itself.
What to Do Now
Our advice is to watch rates carefully. When rates are falling, it’s better to wait until they have hit bottom. The estimates that I’ve seen is that rates will fall to 5.5% for a 30 year conventional mortgage. We will probably hit that rate soon and stay there. We will check every day and report when that bottom is reached.
Call me if about your Ormond Beach, Port Orange or Daytona Beach Florida real estate needs at 385-566-7503.
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