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Mortgage Rates Steady After Budget and Debt Ceiling Deal

Average mortgage rates remain steady as another budget and debt ceiling crisis was averted in Congress. Near the eleventh hour, cooler (or increasingly desperate) heads prevailed on preventing the United States from defaulting for the first time in history. Economists believe the alternative would have been financial disaster and sharply higher mortgage rates.

30 year conventional mortgage rates today are averaging 4.31 percent, up slightly from last week's average 30 year mortgage rate of 4.27 percent. After running up most of the summer to almost near 5.00 percent, 30 year conforming mortgage rates have retreated the past month.



Crisis Averted, Lower Mortgage Rates Headed Our Way


Now that another manufactured crisis has been averted, mortgage rates should continue to drift lower from current levels. The government shutdown and the potential for default has hurt the economy and soured consumer sentiment. Depending on how much consumers pull back and how badly the economy has been hit, we could see 30 year rates fall back below 4.00 percent before the end of 2013.

Back in mid September, we were predicting average 30 year mortgage rates would climb above 5.00 percent before the end of 2013. A deal has been reached in Washington but it is a short term deal as we could be back in the same mess in January. The government has been funded until mid-January and the debt ceiling breach has been put off until early February.

Just knowing that we are a few short months away from possibly more pain inflicted by politicians in Washington will keep downward pressure on economic growth. A slower growing economy will force bond rates lower which will in turn force mortgage rates lower.

Mortgage Rates Steady After Budget and Debt Ceiling Deal

30 Year Conforming Mortgage Rates Today


30 year mortgage rates are higher this week at 4.31 percent but there are many lenders still quoting 30 year mortgage refinance rates below 4.00 percent. Currently on our rate tables for the state of California we have three different lenders quoting 30 year refinance rates at 3.75 percent with various points.

Our rate tables for California also include 8 more lenders quoting 30 year rates at 3.875 percent with various mortgage points.

What are Mortgage Points and Should I Pay Down the Mortgage Rate by Paying Points?


In  case you're unaware of what mortgage points are, they allow a borrower (mortgagor) the ability to secure a lower rate on a loan by paying the lender (mortgagee) money upfront at closing.  1 mortgage point is equal to 1 percent of the loan amount. So for example, a $500,000 loan that has 1 mortgage point will cost the mortgagee $5,000 that has to be paid at the time of closing on the loan. To figure out whether or not it makes financial sense for you to pay down the mortgage rate with points, you have to take several factors into consideration.

The most important factor to think about is how long you plan to stay in the home. You can compare the months you plan to stay in the home with the monthly savings you will achieve by getting lower mortgage rate with points. The easiest way to figure this out is to compare loans, rates and point combinations, by using our mortgage calculator.

Today's Mortgage Rates on 15 Year Conforming Loans


Average 15 year conforming mortgage rates are also slightly higher this week over last. Today's mortgage rates on 15 year loans are averaging 3.36 percent, up from the prior week's average rate of 3.34 percent. The lowest 15 year refinancing rates in our rate database for the state of  Texas are much lower than the average.

The lowest 15 year refi rates on our list for Texas are at 2.75 percent with points. We have three different mortgage lenders quoting 15 year rates at 2.75 percent with points. The lowest 15 year rates without points are still below the average at 3.00 percent. We have 18 lenders quoting 15 year rates without points that are lower than the average of 3.36 percent.

Current Jumbo Mortgage Rates on 30 Year Loans


Current mortgage rates on 30 year jumbo mortgage loans are averaging 4.51 percent, up slightly from the previous week's average 30 year jumbo mortgage rate of 4.49 percent. The lowest 30 year jumbo refinance rates in our database for the state of Florida are much lower than the average.

The lowest 30 year jumbo rate with points in our database for FL is currently at 3.75 percent. The lowest 30 year jumbo rates without points are still below the average rate at 3.375 percent.

15 Year Jumbo Mortgage Rates Today


15 year jumbo mortgage rates are averaging 3.84 percent, up slightly from last week's average 15 year jumbo mortgage rate of 3.82 percent. The lowest 15 year jumbo rates available right now for the state of New Jersey are currently at 3.25 percent with no points. The lender offering that incredibly low rate with zero mortgage points is Spencer Savings Bank.

Today's Adjustable Mortgage Rates


Average 5 year conforming rates and 5 year jumbo rates didn't change week over week. 5 year conforming rates are averaging 3.50 percent and 5 year jumbo rates are averaging 3.08 percent. We have lenders quoting 5 year adjustable rates below the average for both types of loans.

The best 5 year conforming adjustable rates without points in our database in many different states are at 2.25 percent with points. The lowest 5 year conforming rates without points in our database are still well below the average at 2.50 percent. The best jumbo rates on 5 year loans with or without points are at 2.59 percent from Third Federal Savings & Loan.
 
Author: Brian McKay
October 17th, 2013