Mortgage rates are so low right now that a small increase isn't likely to mean that a refinance made sense last week for someone and this week it doesn't
Wilmington, NC (PRWEB) January 21, 2012
Mortgage rates have dropped for the third consecutive week to a new historic low point at the same time mortgage fees charged for new purchase loans and refinances are on the rise, according to mortgage rate research website, BurlingtonMortgage.biz. To pay for the extension of a payroll tax reduction and federal unemployment benefits, Congress voted in December of last year to raise the guarantee fee charged by Fannie Mae and Freddie Mac, and the mortgage insurance premiums charged by the FHA for new mortgage loans.
The amount of the increase is equal to 0.1 of 1 percent, or 10 basis points, approximately $10 per month for each $100,000 of the loan. Lenders will either raise rates slightly to cover this additional cost, or charge higher fees. Though the new fee does not take effect until April 1st, 2012 banks and mortgage lenders will need to implement them for new loans much sooner, so that they are incorporated into loans closing on and after the deadline.
Though the fee increase may have already been implemented by some lenders mortgage pricing remains incredibly low, even breaking previous records for low mortgage rates. On Friday, January 20th, 2012, 30 year fixed rates as low as 3.500% (APR: 3.663%, Points: 2, Fees: $0, Lender: First Financial Services) were posted in the rate tables on BurlingtonMortgage.biz. 15 year loan rates were more steady, but also near historical lows. Rates advertised on the site for the 15 year fixed rate products started at 3.000% (APR: 3.000%, Points: 0, Fees: $0, Lender: First Financial Services.)
The fee increase is not likely to impact the decision of whether or not to refinance for most consumers, as long as rates stay low. "Mortgage rates are so low right now that a small increase isn't likely to mean that a refinance made sense last week for someone and this week it doesn't," said Shaun Hamman, VP of Residential Lending at American Financial Resources, a National mortgage lender. "It's going to take a more significant rise in pricing for us to see that starting to happen," he continued.
Current mortgage rates for a number of different residential mortgage programs can be viewed on BurlingtonMortgage.biz. Below is a snapshot of mortgage rates for a variety of products listed on the site on 01/20/2012. Rates are subject to change. Please visit the site to view the criteria used in the survey.
30 Year Mortgage Rates (0 Points)
EverBank - 3.990% Note Rate, 4.025% APR, $852 Fees
Gateway Bank Mortgage - 3.875% Note Rate, 3.911% APR, $875 Fees
20 Year Mortgage Rates (0 Points)
QuickenLoans - 4.250% Note Rate, 4.341% APR, $1553 Fees
AimLoan - 3.500% Note Rate, 3.613 APR, $1995 Fees
15 Year Mortgage Rates (0 Points)
First Choice Bank - 3.250% Note Rate, 3.326% APR, $1050 Fees
Amerisave Mortgage Corporation - 3.250% Note Rate, 3.395% APR, $1995 Fees
5/1 ARM Rates (0 Points)
Gateway Bank Mortgage - 2.750% Note Rate, 2.784% APR, $875 Fees
AimLoan - 2.500% Note Rate, 2.613% APR, $950 Fees
BurlingtonMortgage.biz is a website that offers information regarding mortgages and personal finance. BurlingtonMortgage.biz is owned by CMG Equities, LLC based in Wilmington, North Carolina.
Update 2/19/2013: BurlingtonMortgage.biz is now PriceAMortgage.com which is also owned and operated by CMG Equities, LLC in Wilmington, North Carolina.
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