30 Year Fixed Mortgage Rates – Interest Rates Below 5.1%
Posted on | August 27, 2009 | No Comments
Mortgage rates are getting quite low as the 30 year fixed mortgage rates level of 5.1% has been breached to the downside. This is not the first time average mortgage rates have been below 5.1% but it could be very significant if overall mortgage interest rates do go below 5%. We have not seen mortgage rates below 5% since the beginning of April and this is definitely a significant psychological level. Most borrowers want to lock in at that rate below 5% even though there is very little difference in a 5.05% rate and a 4.95% rate.
We have seen the 30 year fixed mortgage rate test the 5% level several times in the last few months only to see mortgage rates move back up towards 5.5%. Is seems that every single time we test the psychological level of 5% that the 10 year treasury rate yield starts a strong weekly uptrend that greatly affects daily mortgage rates. There have actually been single weeks in which mortgage interest rates have moved from 5.05% all the way up to 5.5%.
This has been the case mostly because the 10 year treasury rate was in a strong up trend that has lasted since the beginning of 2009. Well, that up trend looks like it has been broken as the 10 year yield has moved sideways to down for the last several weeks. The 10 year yield is now firmly below the 50 day moving average and that average is now down trending. This is great news for overall mortgage rates because the 10 year yield pulls mortgage rates along with it.
Overall it looks as if mortgage rates could head much lower into September. The bad news is that the Federal Reserve Bank is trying to slowly stop buying US Treasuries by the end of September or October. If this does happen, it is likely that we will see another strong move up in the 10 year treasury rate yield which, in turn, would pull mortgage rates up as well. If you are thinking about refinancing or buying your first home, now might be as good of a time as ever because mortgage rates are low and there are many incentives out there.
There are many mortgage lenders out there that are advertising mortgage rates well under 5%. You may think that you do not have access to these low rate but you will never really know until you get out there and see what they say. Most of the lenders offer a phone number to speak to a representative. There is no harm in giving them a call as you can hang up at any time. Take advantage and lock in at these historically low mortgage rates.
Author: Mike Garner
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