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I am the author of this blog and also a top-producing Loan Officer and CEO of InstaMortgage Inc, the fastest-growing mortgage company in America. All the advice is based on my experience of helping thousands of homebuyers and homeowners. We are a mortgage company and will help you with all your mortgage needs. Unlike lead generation websites, we do not sell your information to multiple lenders or third-party companies.
Home builders are looking more confident and housing starts have shot up in November. This is good tidings for aspiring buyers. All 2019, we have fought against low inventory but with some luck, the supply deficit may turn a corner in 2020. Purchase applications usually come down at this time of the year but it is still a clean 10% above on the year-over-year stat.
Mortgage Rates: rates offer a mixed bag
This week’s Mortgage Banking Associations’ (MBA) weekly rate survey reveals a mixed performance across the board.
According to the MBA Weekly Survey: “The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) remained unchanged at 3.98 percent, with points remaining unchanged at 0.33 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.”
1 point in cost = 1% of the loan amount
“The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $484,350) increased to 3.96 percent from 3.90 percent, with points decreasing to 0.26 from 0.27 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.”
“The average contract interest rate for 15-year fixed-rate mortgages increased to 3.40 percent from 3.37 percent, with points decreasing to 0.26 from 0.30 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.”
“The average contract interest rate for 5/1 ARMs decreased to 3.28 percent from 3.52 percent, with points decreasing to 0.23 from 0.24 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.”
Mortgage Rate Activity and Predictions
The Bankrate’s weekly survey of mortgage and economic experts, countrywide, reveals that not a single expert believes rates are going to fall over the coming week (18th December to 25th December).
Out of those surveyed, 69% of experts feel we are headed for a rate hike and 31% sense a decline is on the cards (with a maximum movement of two basis points either side).
Freddie Mac’s weekly mortgage survey has reported that the conforming rates for the week- 11th December to 18th December- have remained unchanged for both 30 Y Fixed and 15 Y Fixed.
Freddie Mac’s weekly mortgage survey noted, “The economy continued to pick up momentum with a solid increase in residential construction, improvement in industrial output in our nation’s factories and a rise in job openings. While the economy is in a sweet spot, improvements in housing market sales volumes will be modest heading into next year simply due to the lack of available inventory. The demand is clearly not being met for entry-level Millennials and trade-up Generation X home buyers. If there was more inventory of unsold homes for buyers to choose from, home sales would be rising at a faster rate.”
Mortgage Rate Lock Advice
I would recommend you to Lock if you are closing within the next 3 weeks and Float if you are closing any time beyond that.