According to the weekly survey on mortgage rates conducted by Freddie Mac for the week ending Thursday, December 23rd, home mortgage rates on both the 30-year and the 15-year fixed-rate have declined slightly over the last week. This is not likely to become a trend. Mortgage rates are expected to reach over 5% within the next few months.
The predictions on where mortgage rates are headed over the next year are uniform throughout the industry. Rates are going to go up. Over the last month we have seen a gradual increase in both the 30-year and the 15-year fixed-rate mortgages. There have been some minor exceptions, such as the declines posted this last week. However, everyone that decides to track mortgages rates should expect the rates to rise over the next year and eventually level out somewhere between 5% and 6%.
Currently the rates are still under 5%, yet they are much significantly higher than the 4.17% record low posted just a month ago. According to the weekly survey of home mortgage rates conducted by Freddie Mac, rates declined by 0.02% on the 30-year and the 15-year fixed-rate mortgages. The average on a 30-year fixed-rate mortgage was 4.81% a decrease from the 4.83% the previous week. The average on a 15-year fixed-rate mortgage was 4.15% a decrease from the 4.17% the prior week.
To obtain rates at the posted figures, borrowers had to pay an average of a 0.7 point on the mortgages, a point is universally 1% of the mortgage amount charged as prepaid interest. To put this in a better perspective, an individual with good credit history trying to qualify for the current rate of 4.81% on their home mortgage loan for a $300,000 home would need to pay an average of $2,100 as prepaid interest.
There are chances that interest rates could dip slightly below the current rate for a brief time. Overall, rates will most likely continue their gradual climb over the next year. Higher mortgage sounds like a bad thing. For those who are trying to qualify for a home loan or are looking to refinance at the historic low rates posted recently and cannot, sure higher rates seem like a bad thing. When the rates go higher and eventually level out, we'll be that much closer to a healthy housing market nationwide.
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