The market news from yesterday was that the Federal Reserve announced that it would buy $300 billion of long-term Treasury bonds, along with an addition $750 billion in mortgage-backed securities. My mortgage broker sent out a corresponding e-mail stating that he expected mortgage rates to drop somewhere around 3/8 to 1/2 points on conforming 30-year fixed mortgages.
The wholesale mortgage rate on a 30-year fixed loan with zero points, a 740+ FICO score and 20% down-payment was about 4.7% recently. The average rate from Bankrate was 5.29%, with an average total of 0.33 points. I don’t recall the exact numbers, but that sounds pretty close to the best rates I saw a few months ago.
If you’re shopping for a mortgage right now, or maybe you have even already locked in your rate, it may be a good idea to see what’s up. I recently shaved off $150 a month off my mortgage payment permanently with a loan modification (not federally subsidized) after researching refinance options. Don’t forget the current $8,000 first-time homebuyer tax credit as well.
For the interested, here is my collection of posts about my home-buying experience.