Mortgage Rates Continue To Rise

Mortgage Rates Continue To Rise

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Home shoppers who were hoping to take advantage of historically low mortgage rates may want to step up their search immediately following the holidays. That’s because rates for all loan types have increased on a week over week basis as calculated by LendingTree.com on December 21.

Current rate averages are still very low with the rate on 30-year fixed rate mortgages now 5.17 percent (5.42% APR) and 4.51 percent (4.91 APR) for 15-year fixed rate mortgages. Adjustable rate mortgages such as a 5/1 ARMs are averaging 4.04 percent (4.21% APR).  A 5/1 mortgage is one where the rate stays fixed for the first five years of the term and then adjusts annually thereafter.

Speaking on behalf of LendingTree.com was home loan shopping expert Nicole Hall who said, “Even with mortgage rates on the rise, the combination of low home prices and today’s low mortgage rates make owning a home more affordable than ever. Consumers looking to get into the market in the new year should understand the process and be prepared to lock in their rate once they’ve found the right loan for their needs. Borrowing costs are still extremely affordable compared to historical averages.”

Indeed, SayEducate.com has been tracking mortgage rates and housing trends for more than three years and reported in December 2010 that trillions of dollars in home value has disappeared in the past few years (see Have Home Prices Dropped By $9 Trillion?). Lower home values easily offsets increases in mortgage rates, but for some shoppers the best of both worlds is what they want.

Mortgage trends are nearly impossible to predict, but given that we’ve already reached bottom, a continued move upward appears to be likely.  As Hall advised, shopping for a loan and locking in a rate can be a wise move, allowing you to concentrate on finding the right home with proof to the home seller that you are mortgage ready.

Adv. — Visit the NBuy Shopping Plaza for seasonal deals and year ’round good buys!

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