Despite the many predictions that mortgage rates would rise in 2016 after the Federal Reserve raised interest rates in December, they have actually declined for the fourth week in a row, according to the Freddie Mac weekly mortgage rate survey.
Why do rates continue to decline? News about low mortgage rates has been eclipsed only by news of declining global markets, specifically the Chinese market, paired with dropping oil prices. This combination of circumstances has caused the Dow to plummet. Experts point out that during turbulent times in the stock market, investors feel that bonds offer more stability, meaning more people buy them, and mortgage rates go down.
How much can you save by getting in now? The Mortgage Reports puts it like this; “Because of how mortgage rates have dropped, if you could afford a $400,000 home in December, today, you can afford a home for $411,000.” Homebuyers are taking advantage, with mortgage applications up 8.8% in one week, according to the Mortgage Bankers Association.
How long will these low rates last? No one knows. If we can learn anything from recent events, it should be that the future is not certain, and a prediction, no matter how educated, is still just a guess. It’s best to focus on the present, and for now, the present is a great time to apply for a mortgage, if you’re in the market.
Visit goldenstatemortgage.com to see current rates today.