June 27, 2020
Mortgage interest rates have averaged around 8% over the last 50 years; however, as can be seen in this dramatic table, rates this low were once thought unimaginable. In fact, after touching a record 3.29% in early March, the 30-year fixed-rate average dipped to just 3.13% in June, according to Freddie Mac. That’s the lowest since Freddie Mac started tracking data in 1971.
If this is your first time buying or refinancing, now you know why the older generation still can’t believe these near-3% rates. July will be a wild ride for mortgage rates. In short, our prediction is that rates are headed downward, with averages finally dropping below 3% for the first time ever by July or August.
That being said, the real world has a way of bucking expectations and to wait for rates to lower still might be taking a big chance on likely your largest investment ever.
Whether you are looking for a new home, an investment property or are in the position to refinance your home, taking advantage of lower interest rates (even if it’s just a single percentage point) could save you thousands of dollars. If you have a fixed-rate mortgage, you won’t see any changes unless you opt to refinance your home loan. If you have an adjustable-rate mortgage (ARM), your monthly payments will typically go down.
If you want numbers specific to your home purchase, you can use an online mortgage calculator to customize your costs. https://www.mortgagecalculator.org/
Consumers should note that following these emergency cuts, prices have fluctuated, and many lenders have seen an influx of applications. The increased interest in loans and refinancing could make it more difficult to apply or increase your waiting period before approval.
I look forward to hearing from you! Tracy
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