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Mortgage Rates: Low Mortgage Rates Continue As Euro Zone Concerns Return

By: | January 4th, 2012

Low mortgage rates continued today as Euro zone concerns returned amongst investors who, just yesterday, had started the year with a stock market rally. With European banks looking at new capital requirements this year, renewed jitters over Europe’s financial crisis are keeping markets flat.

Low mortgage rates continue to attract borrowers who wish to refinance existing mortgages. Current 30 year fixed mortgage rates are at 3.500% and 15 year fixed mortgage interest rates are at 2.875%. 5/1 ARM loan rates are at 2.250%. A history of good credit is required to obtain these low mortgage rates with 0.7 to 1% origination point. Conforming mortgages are full documentation loans which require stable employment that can be verified and bank statements that show enough assets for reserves. Purchasing a home with a conforming mortgage requires a down payment of 20% or a minimum of 5% that will require paying private mortgage insurance on a monthly basis. It is now possible to refinance a conforming mortgage with Harp 2.0 which does not require an appraisal. In all cases, preparation is the key to obtaining a successful mortgage approval.

Today’s FHA 30 year fixed mortgage rates are at 3.250%, FHA 15 year fixed mortgage interest rates are at 2.750% and FHA 5/1 ARM loan rates are at 2.750%. FHA’s current loan limit was recently raised to $729,750 in order to help consumers in high cost areas across the country. With a number of different mortgage products available, borrowers can also obtain an FHA mortgage with low FHA mortgage rates that includes money for repairs and home improvements. Low down payments of 3.5% with a credit score as low as 580 and 10% with a score to 500 have made it possible for many borrowers to become homeowners. FHA also accepts gifts from approved sources and housing grants or loans to help make the home purchase more affordable for borrowers. Closing costs (APR) for FHA mortgages is higher because of the upfront mortgage insurance premium and other FHA fees, but seller concessions up to 3% can be used to help with these additional expenses.

Current jumbo 30 year fixed mortgage interest rates are at 4.125%, jumbo 15 year fixed mortgage rates are at 3.375% and jumbo 5/1 ARM loan rates are at 2.500%. Excellent credit is required to obtain these low jumbo mortgage rates with 0.7 to 1% origination point. Jumbo mortgage borrowers must have stable employment and records of sufficient assets in order for lenders to consider approval. Since jumbo mortgages are usually held within a lender’s portfolio, lenders generally have stricter guidelines that borrowers must adhere to.

Today’s Wells Fargo California 30 year fixed mortgage interest rates are at 3.875% (4.054% APR).

MBS prices (mortgage backed securities) are down -4/32 which is below earlier pricing of +3/32. MBS prices affect mortgage rates which move in the opposite direction. Today’s report from the Commerce Department for Factory Orders came in slightly higher in November which was expected. The Mortgage Banker Association reported that mortgage activity was down for the two week period around the holidays, which is to be expected. Refinance applications continue to be strong as this is the source for the majority of mortgage applications.

FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders’ rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1% point origination fee.

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