Many people are under the impression 30 year fixed FHA Loan Rates are not as good or are better than non-FHA Loan Rates. The truth is the leading indicator for FHA loan rates is the 10 year treasury bond yield. The 10 year treasury yield drives 30 year fixed mortgage rates for non-FHA loans advertised on billboards, television, and online.
Today’s FHA loan rates:
30 year fixed FHA loan rates are as low as 5 percent with zero buy down points. Buy down points also known as discount points. 15 year fixed FHA loan rates are as low as 4.625 percent with zero discount points.
Home Tax Credit for Buying with FHA Loans:
Much of the housing rebound analysts credit to the $8,000 first time home buyer tax credit. The tax credit contains income restrictions but is available to almost anyone who has not purchased a property in the past 3 years.
FHA Loans Stabilizing the Housing Market.
Homes are more affordable than ever according to the home affordability index. Despite record low rates for most of 2009 we’ve seen double digit drop offs in home sales compared to last year. Last year at this time 30 year fixed mortgage rates averaged 6.4%. One reason for the drop off in home sales is the more strict underwriting guidelines requiring 20-30 percent down payments. FHA loans allow home buyers to purchase with little to no money down. FHA loans are the only financing available for people wary of declining markets in a cash rules market to get into a home without breaking their bank. FHA low downpayment loans are credited with stablilizing many US markets as buyers take advantage of bargains on foreclosed properties without tapping into their 401k.