Mortgage Rates Expected to Go Lower
Mortgage lender Freddie Mac reported that interest rates on 30-year fixed-rate mortgage which reached 5 percent for the last couple of days will continue to go lower amid plans of Federal Reserve to inject more than $1 trillion stimulus money to the housing and credit industry to help people avoid foreclosure.
After announcing the Federal Reserve’s plan to inject more than $1 trillion to the housing industry, mortgage lender Freddie Mac said the interest rates on 30-year fixed-rate mortgages which remain lower than 5 percent can be trimmed down if the passage of a new economic bill will be successful.
According to a survey conducted by Freddie Mac, the average rate on 30-year mortgages was 4.98 percent from March 12 to March 19. This rate is lower than the previous week’s 5.03 percent and last year’s 5.87 percent.
The study also said that fifteen-year mortgage rate was also down to 4.61 percent from the previous week’s 4.64 percent, a trend which is considered the lowest in decades.
In an interview, Freddie Mac chief economist Frank Nothaft said that low mortgage interests can help people avoid foreclosure orders. He also said that long-term mortgages have continuously going lower following bond yields.
Meanwhile, another mortgage lender Fannie Mae said that many borrowers have now realized they should take advantage of the low interest mortgage rates.
Experts and analysts all agree that the continuous decline of interest rates with falling home prices will allow people to buy homes easier than the previous years and will reduce the burden of borrowers who are already struggling to pay their debts.
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