Current 30-year mortgage rates remain near their lowest levels of the year.
For home buyers and refinancing households, today's low rates bring extended home affordability and higher household cash flow. If you've bought a home within the last 12 months, there's a chance to refinance and save big dollars.
Have you seen today's low mortgage rates?
According to Freddie Mac, the average 30-year fixed-rate mortgage interest rate rose 0.03 percentage points this past week, climbing to 4.15% nationwide. The rate is available to prime mortgage borrowers willing to pay an accompanying 0.7 discount points due at closing.
The cost of 0.7 discount points is 0.7% of your loan size.
In Los Angeles, California, where the local 2014 conforming loan limit is $625,500, a maximum-sized mortgage at 4.15 percent would require an additional $4,379 to be paid at closing.
Lenders offer loans with no points, too, but the accompanying mortgage rates are often higher.
As an illustration, a loan in today's market with zero points will price closer to 4.375% than the weekly rate cited by Freddie Mac.
Mortgage applicants may also opt for more points in order to work their mortgage rates lower. A mortgage applicant willing to pay a full discount point (or more) can now get rates in the 3s.
Freddie Mac's mortgage rate survey shows interest rates to be within striking distance of their 13-month low point; and, since the New Year, rates are down big -- as much as a half-percentage point.
Note that FHA mortgage rates and VA mortgage rates are tracked separately. Freddie Mac's weekly survey doesn't report on FHA and VA mortgages, but rates for both products are near 13-month lows, too.
It's been a good year to shop for a home loan.
Mortgage rates are near a 13-month low, reaching levels not seen since June 2013.
When mortgage rates fall, it opens refinance opportunities for all of today's homeowners but especially for consumers with an existing FHA or VA home loan. This is because the FHA Streamline Refinance and VA Streamline Refinance programs enforce a minimum monthly savings requirement for their refinance applicants.
With mortgage rates down, meeting the FHA and VA requirements is easier.
As compared to January 1, mortgage payments are 4.4% cheaper. Homeowners who bought this past January, then, could potentially refinance their home and pocket an extra five percent monthly.
Furthermore, at today's low mortgage rates, the "principal" of each monthly payment is large.
At today's mortgage rates, a homeowner's payment contains 7% more principal as compared to a mortgage from the start of the year. Homeowners build home equity more quickly at today's low rates.
Refinance opportunities are plentiful for today's U.S. homeowners.
The FHA makes available its FHA Streamline Refinance program; the Department of Veterans Affairs makes available its VA Streamline Refinance (IRRRL); and, via Fannie Mae and Freddie Mac, underwater homeowners can refinance using the Home Affordable Refinance Program (HARP).
It's today's active home buyers who may benefit most, however. Not only are current mortgage rates low, but there is a bevy of low- and no-downpayment mortgage programs meant to make qualifying for homeownership easier.
Among the most popular programs is the FHA 3.5% downpayment mortgage.
Available to buyers in all 50 states and the District of Columba, the FHA 3.5% downpayment mortgage is the agency's flagship program. It permit loan sizes of up to $625,500 and allows buyers to use gift funds for downpayment.
Furthermore, because the FHA loan is insured by the government, FHA loans are often aggressively priced -- especially for buyers with less-than-perfect credit scores; or, for buyers buying 2-unit, 3-unit, or 4-unit homes.
Another popular low-downpayment mortgage program is the VA loan program. Available to military borrowers, the VA loan requires no downpayment and no annual mortgage insurance. Similar to FHA loans, VA loans offer flexible underwriting standards.
VA mortgage rates are typically lower than comparable conventional ones.
A third low-downpayment mortgage option is the USDA loan via the U.S. Department of Agriculture.
The USDA Loan, which is also called a Rural Housing Loan, isn't just limited to homes in farming and rural towns -- many homes in suburban towns are eligible as well.
USDA loans can be no money down and mortgage insurance requirements are reduced as compared to an FHA or conventional loan.
USDA loans are available from most major lenders.
Mortgage rates today are near a 13-month low. Home buyers are gaining new purchasing power; and, existing homeowners have rekindled opportunities to refinance.
Compare today's mortgage rates and see what you can save. Rates are available for free online, with no obligation to proceed, and with no social security number required to get started.
The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.
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2015 Conforming & FHA Loan Limits
Mortgage loan limits for every U.S. county,
as published by Fannie Mae & Freddie Mac, and the FHA.