Rates Still at Historic Lows
Mortgage rates have continued at an all-time low for several weeks. Could they go any lower? What is being experienced is lower costs and/or lower closing costs instead of lower rates. Yes, the rates could have dropped lower on Friday, September 9, but the rates did not drop in response to the stock market as most people expected. What happened instead was a drop in the loan origination fees, and a drop in closing costs for the consumer.
Concern in the mortgage market is now centered on the premium loan limit set by Fannie and Freddie. It is due to expire soon, and homeowners who need to sell their higher-end homes are wringing their hands. If the limits expire it will be difficult for buyers to get a loan for a home over $450,000 at a good rate. If the limits are extended it could be a boost for the high-end market.