Friday, January 7, 2011

Mortgage Rates Back on the Decline

After a two month rise rates have now dropped for both long and short term fixed mortgages. Average rate for a 30 year fixed rate mortgage is 4.77 percent this week, a .09 decrease since last week. Looking for a short term option? 15 year fixed rate mortgages averaged at 4.13 percent, a .07 percent dip from last week. I mean this is MADNESS people! Last November, however, the 30 year FRMs were an astonishingly low 4.17 percent, the lowest in over 30 years. Unfortunately after that low point the rates climbed again but just this week took a slight drop. So what does this all mean, you ask? Take this beautiful home in Orem I have pictured here. You are going to finance $350,000 of the $400,000 asking price. With a 30 year FRM at 4.77 percent (this weeks average) you expect to pay $658,795.44 over the 30 year period, now if you had bought this house last week with the 4.86 percent rate you would pay $665,655.65 over the full term of the loan. That's a difference of $6,860.21 dollars for only a .09 percent difference in interest rate! On the contrary, if you would have bought that home last November you would only have payed $613,957.42 over the course of the loan, that's a $44,838.02 difference from if you bought it today!
If you are in the market for a new home make sure to pay attention to the rate trends, because you don't want to get locked in at the wrong time. Take advantage of these historically low rates and strike while its hot!
Love this home? Visit for listing details:

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