Historical Mortgage Rates Chart (1986-2010)

While doing some more research into a possible refinance or loan modification, I ran across this chart of historical mortgage rates from 1986 from HSH.

Before, I stated a source that said the 30-year fixed-rate mortgage (FRM) averaged 4.56% for the week ending July 22, the lowest since Freddie Mac started tracking the mortgage in 1971. But that was with 0.7 points, while HSH shows 4.97% with only 0.09 points. While we are experiencing some of the lowest rates in a very long time, I also keep reading about how underwriting has made actually getting approved for a loan harder than ever. But according to this article, some “FHA, Fannie Mae and Freddie Mac borrowers who haven’t refinanced their home before may be eligible to refinance without having to get a new appraisal.” Like I say often… it doesn’t hurt to ask!

I’m still excited about my new 4.75% mortgage rate (that I would never have gotten if I didn’t pick up the phone and ask) since I’m looking to stay in my house for a while, but I am also curious as to what will happen to housing prices when rates start to go back up…

Comments

  1. Patrick says:

    We are going through a refi right now from 5.35% to 4.65%. It will save us approx $90 a month. No points and no closing costs. Our appraisal came in $6,000 lower than the purchase price a year ago august. At what point is it not worth the hit in equity vs the monthly/loan term savings?

  2. Hi Patrick, how is ur lender? just curious. cuz thats a good deal with zero cost and zero points.

  3. Patrick,

    I’d like to know where you managed to get such a deal. I could use the same deal myself.

  4. I’m looking to buy my first home and am REALLY excited out such low rates. My mortgage broker mentioned when he started in the business they were around 10% – CRAZY!

  5. Chris in Boston says:

    I think this is not 100% accurate. I know for a fact that in 2003 there was a brief period where rates dipped as low as 4.75% for a 30y FRM. I was turned down for that rate on a refi application because of a tax lien on my property, due to an escrow screw up by City of Boston and GMAC Mortgage at the time.

    It is VERY tough to get a refi today. I was able to complete one last May. It took me 9 months from start to closing to complete me refi. I was able to reduce my rate from 6.50% to 4.75% with no points going through Bank of America. I did have to pay closing costs, appraisal fees, and attorney fees. But I saved over $689 a month in the process and will have recouped my refi costs in less than 12 months.

  6. I was looking to refinance and locked in my rate n June 24th 2010 when 15 years dropped to 4.25% with Bank of America. I refinanced from 30 years @ 6.625 with Bank of America to 15 years @ 4.25% with Bank of America. The monthly payment is more but only by 15% which isn’t bad. Within 12 months I’ll be at the same principle I was at with the previous mortgage. My refinance closed within 32 days, I closed earlier this morning. My house was appraised with 8 days of having the rate locked in. I have been truly amazed on how fast and easy this refinance process has been for me.

  7. joelkton says:

    I’m no expert, but the low rates are very likely a last-ditch effort to keep housing prices artificially inflated. As soon as rates have to rise, prices will have to fall. Didn’t I read somewhere that, historically, the average house price has been 3x annual income. That would make the average around a 150,000.

    Like you, I’m very curious to see what will happen when rates rise. Very, very curious.

  8. Patrick says:

    I could give you the name and number of my broker, but, I can’t say for sure if he will give you the same deal as me. I did my original mortgage through him as well.

  9. Got a 4.375% for a 30-yr with 0 points and 0% originating fee. Sweet deal to bring down my APR from 5.5% to 4.375%…saving $200plus every month! YAY!

  10. Hi Gloria,

    Great rate. May I know which state and lender?

  11. Here is an updated Shiller Price Index showing where House Prices are at historically…

    http://www.ritholtz.com/blog/2010/07/updating-the-case-shiller-100-chart-forecast/

    When rates do go up, expect house prices to continue to fall.

    I bought a new house in January and locked in a 30 yr fixed with no points at 4.75. It was the 40 year low at the time, which has since gone a bit lower.

    I fully expect my house price to fall quite a bit…

  12. joelkton says:

    Maury, great chart, thanks. I remember watching a video that showed the graph as a roller coaster from the point of view of the rider. It went up and down, up and down and then it just kept on going during the last bubble. It was produced before the bubble burst, I think, and I’ve always wondered about it. Perhaps there was a link here to Jonathan’s site, I don’t remember. Anyone know if it’s still out there?

  13. When rates go up, that would put some presure on the housing prices to go further down.

    Also, you can have both rates and prices going down. That has been happening in Japan for about 10-12 years after their real estate buble. Rates were near 0%, they had deflation, and housing prices kept on droping. Historically in U.S. that happend in 1890s as well, but not recently — it does not mean it cannot happen again.

    Patrick, your equity is already down $6,000 so this re-fi does not do anything additonal. If it represents actual market price, that means it is reflected in the appraisal.

    Jenna, your broker has not been in the business all that long, rates were around 15%-18% about 27 years ago, and that was not all that unusual.

  14. @PedroNY – I think he started 20-ish years ago.

  15. http://www.youtube.com/watch?v=kUldGc06S3U

    Aha! This is the video I remembered of the roller coaster housing price chart. Very illuminating.

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