Future Direction of Mortgage Rates Will be lower in 2013 Thanks to the Fed

Since the financial crisis and the great recession the Federal Reserve has been on a campaign to force mortgage rates lower to help the housing market and the economy. The Fed has been very successful at driving mortgage rates to record lows but the housing market is still in the doldrums, at least until recently. Two strong housing reports released last week is giving hope that low mortgage rates today are finally helping the housing market recover from the worst bust since the depression of the 1930's.

The National Association of Realtors last week said existing home sales increased 7.8 percent in August, the biggest increase in more than two years. Not only are home sales increasing the price of a home year over year has increased as well. The NAR also said the median price nationwide for existing home resales rose 9.5 percent from a year earlier. An annual price gain that high reminds me of the boom a few years ago.

Loan Type
Purchase    Refinance
Location
State/City    Zip Code
Loan Amt Points FICO % Down
  
$
30 yr fixed refi in 23223, All points, Credit score: 740+     Sort by:
Lender
APR
Rate
Cost & Fees
Notes
 
30 yr fixed Mortgage Loan from JG Wentworth Home Lending
JG Wentworth Home Lending
https://www.brimg.net/system/img/inst/10054_logo.gif
300000
Refinance
4.258
4.250
USD
JG Wentworth Home Lending Logo
NMLS # 2925
State Lic # MC-1875
at 0.000 pts
45 day lock rate
Est payment: $1,475.82
Fees in APR: $299
 
 
30 yr fixed mtg refi Mortgage Loan from Virginia Credit Union
Virginia Credit Union
300000
Refinance
4.328
4.250
USD
Virginia Credit Union
4.328%
4/16/2019
4.250%
at 0.375 pts
45 day lock rate
Est payment: $1,475.82
Fees in APR: $1,650
 
 
30 yr fixed mtg refi Mortgage Loan from Fulton Bank, NA
Fulton Bank, NA
300000
Refinance
4.529
4.500
USD
Fulton Bank, NA
4.529%
4/16/2019
4.500%
at 0.000 pts
60 day lock rate
Est payment: $1,520.06
Fees in APR: $1,007
 
 
30 yr fixed mtg refi Mortgage Loan from State Department Federal Credit Union
State Department Federal Credit Union
300000
Refinance
4.432
4.375
USD
State Department Federal Credit Union
4.432%
4/15/2019
4.375%
at 0.000 pts
60 day lock rate
Est payment: $1,497.86
Fees in APR: $2,000
 
 
30 yr fixed mtg refi Mortgage Loan from Citizens Bank, NA
Citizens Bank, NA
300000
Refinance
4.415
4.375
USD
Citizens Bank, NA
4.415%
4/12/2019
4.375%
at 0.000 pts
60 day lock rate
Est payment: $1,497.86
Fees in APR: $1,408
 
 
30 yr fixed mtg refi Mortgage Loan from LincolnWay Community Bank
LincolnWay Community Bank
300000
Refinance
4.155
4.125
USD
LincolnWay Community Bank
4.155%
4/16/2019
4.125%
at 0.000 pts
30 day lock rate
Est payment: $1,453.95
Fees in APR: $1,085
 
 
30 yr fixed mtg refi Mortgage Loan from Bank of America
Bank of America
300000
Refinance
4.343
4.250
USD
Bank of America
4.343%
4/17/2019
4.250%
at 0.671 pts
60 day lock rate
Est payment: $1,475.82
Fees in APR: $1,289
 
 
30 yr fixed mtg refi Mortgage Loan from TD Bank, NA
TD Bank, NA
300000
Refinance
4.278
4.250
USD
TD Bank, NA
4.278%
4/19/2019
4.250%
at 0.000 pts
45 day lock rate
Est payment: $1,475.82
Fees in APR: $982
 
 
30 yr fixed mtg refi Mortgage Loan from Santander Bank, N.A.
Santander Bank, N.A.
300000
Refinance
4.557
4.500
USD
Santander Bank, N.A.
4.557%
4/19/2019
4.500%
at 0.000 pts
60 day lock rate
Est payment: $1,520.06
Fees in APR: $2,004
 
 
30 yr fixed mtg refi Mortgage Loan from Bank of Oak Ridge
Bank of Oak Ridge
300000
Refinance
4.295
4.250
USD
Bank of Oak Ridge
4.295%
4/18/2019
4.250%
at 0.250 pts
60 day lock rate
Est payment: $1,475.82
Fees in APR: $853
 
 
30 yr fixed mtg refi Mortgage Loan from Northwest Federal Credit Union
Northwest Federal Credit Union
300000
Refinance
4.316
4.250
USD
Northwest Federal Credit Union
4.316%
4/17/2019
4.250%
at 0.750 pts
45 day lock rate
Est payment: $1,475.82
Fees in APR: $79
 
 
30 yr fixed mtg refi Mortgage Loan from Apple Federal Credit Union
Apple Federal Credit Union
300000
Refinance
4.345
4.250
USD
Apple Federal Credit Union
4.345%
4/17/2019
4.250%
at 1.000 pts
60 day lock rate
Est payment: $1,475.82
Fees in APR: $352
 
 

Mortage Data Provided by Bankrate.com Many lenders have different rates on their own Websites than those posted on Bankrate.com. In order to get the Bankrate.com rate, please identify yourself as a Bankrate.com customer. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the lender you choose, please click here.

The rates above were collected by Bankrate.com on the dates specified. Rates are subject to change without notice and may vary from branch to branch. Rate/APR and terms may vary based on the creditworthiness of the individual and the extent to which the loan differs from the one used for Bankrate.com quotes. For criteria used in surveys of rates above, click here. These quotes are from banks, thrifts, and brokers, some of whom have paid for a link to their own Web site, where you can find additional information.






Another report showing that the housing market is making a come back is housing starts increased at an annual rate of 750,000 last month, an increase of 2.3 percent from a month earlier in a report released by The Commerce Department. There has been a refinance boom because of low refinance rates the past couple of years but it appears people are finally buying homes again enticed by record low mortgage interest rates. Home builders recognize there is a lot of pent up demand over the past several years and are finally breaking ground on new homes to supply the demand.

Average 30 year mortgage rates recently tied a record low of of 3.49 percent in Freddie Mac's Primary Mortgage Market Survey. Average 15 year mortgage rates hit a record low of 2.77 percent in Freddie's survey last week. The future direction of mortgage rates will be even lower in the coming year.

The Federal Reserve announced they will buy $40 billion a month in mortgage backed securities (MBS) to drive mortgage rates even lower. MBS are investment products sold to investors. Lenders basically take a bunch of mortgages, bunch them together and they are sold as securities to investors. Since the Fed is buying these securities they will be enticing lenders to make more loans which will bring mortgage rates down even more.

In 2013 we would possibly see 30 year mortgage refinance rates come down to the 3.00 percent range on conforming loans. Fixed conforming 15 year mortgage rates could come down to the 2.25 percent range. Jumbo mortgage rates will also make new lows in 2013. Average 30 year jumbo mortgage rates which currently are around 4.00 percent could come down to 3.50 percent. Average 15 year jumbo mortgage rates today are at 3.20 percent could come down to the 2.75 percent range.
 
 
Author: Robert Till
September 23rd, 2012
Posted in: Mortgage Rates