You know what they say, what you think is going to happen and what actually happens can be entirely two different things. Such is the case with the recent movement in refinance mortgage rates. Most experts expected mortgage rates to go up in April with the expiration of two major government programs aimed at keeping interest rates low.
Well, you guessed it. Exactly the opposite happened and mortgage rates in May and now June have dipped to the lowest point in history.
You can thank the current historic low mortgage refinance rates on the European economic crisis, and more directly to the potential insolvency in Greece. With the perceived global economic risk, investors have flooded back in to US Treasuries. As we know, when treasuries are bought up, the yield decreases. Since mortgage rates are heavily tied to the yield on the 10-year treasury yield, rates have continued their plunge.
On the home value front, the government home purchase tax credit is now gone and many economists caution that Americans are facing so many financial obstacles that falling rates alone won't be enough to lift the housing market.
Home prices fell 0.5 percent in March from February, according to the Standard & Poor's/Case-Shiller 20-city index released May 25. This marks six straight months of declines -- a sign that the housing market is going in reverse.
Mortgage delinquencies reached a record high in the first quarter. More than 10 percent of homeowners with a mortgage missed at least one payment from January through March, the Mortgage Bankers Association said last week.
You would think that the current low mortgage rates and falling home prices would be bringing buyers out of the woodwork, but the all-important jobs picture may be the culprit for the less than stellar home buying outlook for the remainder of 2010.
Friday's May employment report will be an important number this week for both the economic picture and for mortgage rates direction in the short-term.
15 year fixed rate mortgages are at astounding low levels. If you are in a 30 year mortgage with a good rate, you still might want to take a look into a 15 yr mortgage at 4.5 percent or lower with virtually no closing costs if you have good to great credit and a loan-to-value ratio that is 80 percent or lower. A switch into a 15-year can save a homeowner up to hundreds of thousands of dollars in saved interest over the term of their new home loan.
If you are considering a home mortgage refinance now and need some help, have questions, or need some competitive refinance rate quotes, please check out the popular Refinance Tool Box. Just give a call at 888-850-9888 or fill out a Rate Quote Request online for professional assistance without the aggressive high-pressure sales tactics.
May the Mortgage Refinance Rates be with You!
Refinance Tool Box
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