San Diego, CA (PRWEB) May 21, 2014
Minutes from last month’s FOMC meeting being released did not seem to have much of an affect on mortgage rates today. These minutes have the potential to influence mortgage rates greatly, since Fed policy discussed in these meetings impacts bond prices and interest rates. However, today saw mortgage rates still unchanged from yesterday’s slightly improved levels. Blue Home Loans, Inc., a California-based full service mortgage company that has been helping CA residents find the best rates and loans available for many years, has been keeping track of these recent mortgage rates trends and now comments on the current situation and offers some advice for those who are not sure how to proceed with their home loan plans.
A May 21st report from Mortgage News Daily says, “Mortgage rates held almost perfectly steady today, despite the potentially important release of last month's meeting minutes from the FOMC (aka "The Fed"). That said, markets arguably had already reacted to some of today's information during yesterday's trading session when NY Fed President William Dudley alluded to it. The most prevalently quoted conforming 30yr fixed rate for best-case scenarios (best-execution) remains 4.125%, but many lenders remain better-priced at 4.25%. "Better-priced" in this context, means that the combination of closing costs and contract rate (the actual interest rate at the top of a mortgage quote) presents better bang for the buck. One of the factors helping mortgage rates stay historically low over the past few years is the Fed's direct purchase of Mortgage-Backed-Securities (MBS). Simplified to the extreme, this means the Fed is fronting the money for all new Conforming mortgages. Individual mortgages comprise MBS, and the Fed buys MBS, thus providing constant demand and liquidity in the mortgage market.”
Blue Home Loans explains that this bond buying program instituted by the Fed resulted in the lowest mortgage rates in history being reached last year. However, since the plan was to stimulate economic recovery until the economy could support itself, the Fed announced a tapering off of their MBS reinvestment last year, leading to a sharp increase in rates. Things have leveled off since then, and rates have even gone against predictions by staying low well into the year when forecasts had them rising to the 5% mark by the end of 2014. Now, it seems that these lower levels could be a sustainable change, as the FOMC minutes show that the Fed is discussing adjusting the framework of the original tapering plan in order to ensure the continued recovery of the housing market.
What does this mean for home loan borrowers? Blue Home Loans explains any changes are still in the discussion stage, so it is best to err on the side of caution when seeking the best loan rate. Rates could continue at these current low levels for some time, but unless they push further down soon, the risk of them bouncing higher is great. Because of this, the California mortgage company suggests that those who are near to closing on their home loans should consider locking in the currently low home loan rates available. Even those who have not started their loan process yet can benefit from this advice by locking in on application with a lender that allows for renegotiation. This will allow them to keep current low rates in reserve while keeping their options open in case rates dip lower before their loan closes.
Blue Home Loans can help California borrowers who are looking for the best rates, lenders and loan programs to find exactly what they need so that they can take advantage of today’s lowest mortgage rates and save thousands of dollars on their loans. As the Blue Home Loans website says, “We make finding a loan simple because we have virtually every loan program available, regardless of the type of mortgage you are looking for. Whether you are dealing with bad credit, foreclosure, bankruptcy, or low credit scores, we can help you. It only takes us five minutes to find the right program that fits your needs.”
For more information on how Blue Home Loans can help California home loan borrowers get approved for their home purchase loan or refinance quickly, please visit BlueHomeLoans.com or call 1-888-929-BLUE (2583) to speak with an experienced mortgage professional.
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