Mortgage rates almost unchanged
February 15, 2008
As the week comes to an end the mortgage rates were mixed throughout the country but remained largely unchanged. The mortgage rates did not go through any amount of significant change even as the labor productivity went higher than the predictions this week and the pending sales of the innumerable homes weakened as per the report of Freddie Mac on Thursday this week. This left the people who are trying to get a refinance done in a tricky position.
The loan purchaser who is sponsored by the Government said that the thirty year fixed rate loans were averaged at 5.72 percent as the week came to an end. This was actually higher than the previous week’s standing, which was at 5.67 percent. But Freddie Mac said that last year at the same time the rate was averaged at a figure of 6.3 percent. The rates for a fixed rate loan for 15 years averaged at 5.25 percent which was higher than last week’s rate of 5.15 percent. The rate for a fifteen year fixed rate loan at the same time last year was however averaged at 6.03 percent. When the rates for a five year adjustable rate loan were averaged at 6.01 percent in the previous year, this week it was averaged at 5.19 percent after it came down from last week’s average of 5.21 percent.
The average rates of one-year Adjustable Rate Mortgages (ARMs) which are indexed by the treasury were at 5.03 percent at the end of the week and this was the same average in the previous week too. The average rate of this one year ago at the same time was however 5.52 percent.
Since the amount of economic data that was let out was relatively small the present state of the economy remained in a situation of haze and doubt. According to Freddie Mac vice president and chief economist Frank Nothaft, this was one of the main reasons as to why the mortgage rates remained almost unchanged. Freddie Mac however believes that once more data regarding the present scenario of the current economic situation is let out the confusions that are present now about the credibility of the economy would clear. This would ultimately lead to the mortgage rates changing by a significant amount. Now that the stimulus plan has been authorized by the President the home owners are going to find getting a refinance for their home relatively more easy.
He however said that one of the good things that happened in the week is that the labor productivity went higher than what was expected in the last quarter of the year 2007. Another thing that happened in the labor sector is that the profits in the labor expenses slowed. But he also said that the existing sale of homes which were pending went down in the month of December. This was reason enough to indicate that the home sales were going to be very weak in January and February as well.