Interest Rates!

Interest rates are at 30-35 year lows. We are seeing 30 year fixed rate loans in the mid-upper 4% range. The summer of 2010 may go down in history as one of the best times to buy that new home. The prices of another recession where interest rates approached 17% fixed rate. A $70,000 home then at 16% had principal&interest (P&I) payment of $941.33. A $140,000 home with a 5%, 30 year fixed rate loan has P&I payment of $751.55.

All time low reached Friday for Conventional fixed mortgage rates. The 30-year fixed mortgage rate available to well-qualified consumers at 1 point orgination dropped to 4.375% from 4.5%. The 15-year fixed rate also declined, from 4% to 3.875%. Never before have mortgage rates been this low.

Friday, mortgage-backed prices had a bif incerese that caused the decline in mortgage rates. MBS prices, which force mortgage rates in the opposite direction, gained +21/32 (FNMA 30-yr 4.5 at 102.23) on less than spectacular jobs numbers are more European debt concerns, this time in Hungary. Typically when we see major declines in stocks as we have recently, mortgage rates improve.