Will Low Mortgage Rates Go Up?

Low Mortgage Rates

Gustan Cho Associates

Low mortgage rates are still at a 22 month low.  However, low mortgage rates had a sudden spike last week.  Mortgage rates on a 30 year fixed rate conventional loan rose to an average of 3.86% last week.  It was the biggest jump in mortgage rates nationwide in a single one week period since January 1st, 2014.  Mortgage rates on FHA loans, VA loans, and USDA loans also rose 0.125% on the average nationwide.  Low mortgage rates fluctuate not just on a weekly basis but several times each day.  Mortgage lenders often have reprices on their pricing engines several times each day.  This week can be a volatile market for mortgage rates as well depending on how volatile the stock market is.

Is The Sudden Rise In Mortgage Rates A Sign That Rates Will Go Up?

Last week’s sudden rise in mortgage rates of 11 basis points on 30 year fixed rate conventional loans averaged nationwide conventional mortgage rates at 3.86%.  Reason for the sudden spike in mortgage rates was due to economic data released last week.  Mortgage experts are watching mortgage rates for this week to see the outcome of retail sales number and the strength of the U.S. dollar and the volatility in Wall Street.

15 year fixed conventional mortgage rates have rose as well last week by 7 basis points for a nationwide average of 3.03%.  Both 30 year and 15 year fixed conventional mortgage rates are par pricing for excellent credit mortgage loan borrowers, often referred to prime borrowers.  Borrowers will less than perfect credit will get price adjustments to par mortgage rates.  Excellent credit prime borrowers are borrowers with credit scores of over 740 FICO credit scores with 20% down payment on a home purchase.  These statistics are for conventional loans only and does not apply to FHA loans, VA loans, and USDA loans.  However, government mortgage rates follow conventional loan mortgage rates trends.

Homeowners Refinancing Need To Lock Mortgage Rate

For homeowners who have been working on refinancing their current home loans and are in the process, they should consider locking their mortgage rates as soon as possible.  Mortgage rates are expected to rise starting the second half of 2015 and until the second half of this year approaches, mortgage rates are expected to be extremely volative.  Even with last week’s sudden spike in mortgage rates to 3.86%, mortgage rates are still at a 22 month low.  How long with it remain at these levels, nobody has a crystal ball.  Homeowners with current mortgage rates of 4.5% or higher should definitely consult with a loan officer and consider refinancing their home loans and see if they can benefit and save money by refinancing their current home loans now.

Back in July of 2013, millions of homeowners were in the process of refinancing their home loans and all of a sudden mortgage rates sky rocketed and many lost their chances to proceed and close on their refinance mortgage loans.  From all the signs, it seems like history is about to repeat itself.

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The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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