Mortgage Rates Hit 3-Year Lows, Foreclosure Rates Continue Dropping
Good news for home buyers—this month mortgage rates officially hit a 3-year low. As of May 10th, rates were 3.5-3.635% for 30-year fixed loans. This is the lowest that they have been on average over the entire 3-year time period (last year, the rate was 3.84%). All in all, this is something of a surprise since the Fed hiked its own rates back in December. This caused a lot of people to worry that mortgage rates would soar in 2016.
Why have mortgage rates unexpectedly dropped? Declines in the cost of stocks and commodities have caused traders to shy away from risk.
Will Mortgage Rates Rise Soon?
The Fed did signal on May 18th that it may raise rates on its short-term loans once again. This hike could come as early as June 14th-15th, the next scheduled meeting for Fed policymakers.
Should this concern you if you are in the market for a home? Not necessarily. The Fed has an influence on mortgage rates, but has no direct control over those rates. Plus, home buyers need to look at the big picture. Right now, rates for home loans are pretty close to bottoming out. We’re looking at near-all-time lows. So while prices may go up in accordance with the next hike from the Fed, we are still going to be looking at very low mortgage rates. You will be in far better shape shopping for a mortgage over the next year than you would have been in the past.
On top of that, a lot of investors are still nervous about high-risk investments. This is going to cause them to hang onto solid assets, including homes. This will curb mortgage rates.
Foreclosure Rates Are Dropping
In other good news, foreclosure rates around the country have continued to fall. We are looking at rates right now which are as low as they have been in nine years. In other words, we are seeing fewer foreclosures now than we have since before the recession. That does mean that it may be harder to find a bargain price for a distressed property, but it also indicates that homeowners are becoming more secure in their investments.
If you are in the market for a home in the San Jose area, this is a perfect time to hunt for a mortgage. If you can lock in a fixed rate on a mortgage now, you will be able to enjoy the same excellent low rates over the years to come. We have not seen an opportunity this good in a long time.
We Can Help You Get the Lowest Rates
Need help searching for the best rates? Here at C2 Financial, we help home buyers with a diverse range of needs and income levels to find the best rates on beautiful properties throughout the San Jose area. We can even help you with HARP, FHA, and VA loans. If you are ready to take the next step in your search for your dream home, click on “Get a Free Quote now!” on the right-hand side of the screen, or give us a call at (408) 599-3628.