Mortgage rates drop to lowest on record

[SarahB]

Source: MSNBC

Rates on 30-year mortgages fell to the lowest level in decades for the ninth time in 12 weeks, pushed down by traders anticipating a move by the Federal Reserve to pump more money into the economy.

The average rate for 30-year fixed loans dropped to 4.27 percent, mortgage buyer Freddie Mac said Thursday. That's the lowest on records dating back to 1971, and down from 4.32 percent the previous week.

The average rate on 15-year fixed loans, a popular choice for refinancing, dropped to 3.72 percent from 3.75 percent. That was lowest on records dating back to 1991.
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However, historically low rates haven't helped the struggling housing market, which recorded its worst summer in more than a decade.

Sales this fall are not expected to improve that much. Job concerns have kept many people from buying homes. Tighter credit standards have also dissuaded many would-be buyers from purchasing. Experts also expect the worst-hit cities to face more foreclosures and other distressed sales.

Read more: http://www.msnbc.msn.com/id/38770102/ns/business-real_estate/

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If the economy really is improving, how come historically low interest rates have not increased home sales? How come they are, in fact, going in the opposite direction?

[rfranklin]

1. You couldn't pay me to buy real estate now...

As long as there is a shortage of jobs nothing is going to improve.

[Iowa]

6. When everything is shit, that's often the best time to buy...

I bought into the Vanguard Real Estate Investment Trust fund back in late 2008 after share prices had plummeted and most people thought the sky was falling. I've made some pretty good money on that buy.

[greiner3]

2. Bought my house from a Fannie Mae repo reseller 5 months ago;

And am waiting for one more monthly mortgage payment so I can refi. I'll save $50 a month. That will put me just above what I was paying for rent in February of this year.

=)

[demosincebirth]

3. Now is the best time to buy If you can.

[South End Liberal]

4. If you can't qualify for a loan, you can't take advantage of the rates.

Which came first, the chicken or the egg? If you don't have a job or owe too much on your credit cards, you can't qualify for a loan, so you keep renting. If you keep renting, the people who make a living building homes don't get paychecks, so they can't buy homes either. Nor can the people who work for appraisers, home inspection companies, title companies, etc, etc, etc.

We're at ground zero of the real estate melt down here in Florida, and more than 50% of the current home sales are short sales (pre-foreclosure) or bank REOs (already foreclosed). Banks here don't want FHA or VA buyers. Period. You have 20% down or get lost. Cash is king on these types of sales.

Banks are doing everything possible to NOT loan money to credit worthy people, so the interest rates on mortgages here are about as useful as a winter jacket in July.

[madrchsod]

5. my adjustable is down to about 3%

no one has the money or credit to by a used home or new home. there`s some incredible bargains out there!

[3waygeek]

7. Mine's only a little higher than that...

I got a FHA adjustable back in '93. It adjusts only once per year, by no more than 1% per year or 5% over the life of the loan.