Global economic concerns continued to act as the albatross pulling U.S. mortgage rates down, as the HSH.com Weekly Mortgage Rates Radar for the week ended January 13 showed interest rates decreasing for the two popular types of mortgages, that it covers in the weekly report.
Previously, HSH.com had also compiled data for 15-year fixed-rate mortgages, but the company had shifted to a more streamlined version of its Mortgage Rates Radar, simply focusing on 30-year FRMs and 5/1 adjustable-rate mortgages alone. For 30-year FRMs, the average rate for conforming mortgages (balance of $417,000 or less) had dropped by six basis points from 3.83 percent to 3.77 percent. 5/1 Hybrid ARMs, on the other hand, lost eight basis points, slipping from 3.12 percent in the first survey of 2015 to 3.04 percent as of January 13, 2015. Average points were at 0.18 and 0.09 respectively for 30-year FRMs and 5/1 ARMs.
“The world’s economic and political pessimism continues to outweigh the relative optimism about the U.S. economy’s prospects,” said HSH.com vice president Keith Gumbinger, emphasizing the geopolitical and global economic concerns that have been driving mortgage rates downwards these past few weeks. “With bonds in Germany and Japan at record low levels, U.S. yields look very attractive, and provide a place for investors to escape market turmoil and get a better return as well, even as the influx of cash to these shores continues to push U.S. yields somewhat lower.”
Some of these concerns include uncertainty with the Euro, poor inflation rates in many global markets, and the general feeling that worldwide markets are on the downturn. While this does not augur well for many consumers outside the United States, it has only brought positive news for American mortgage consumers, who can now take advantage of the lowest mortgage rates available since the late spring of 2013.
Since the first week of December, 30-year FRMs have slipped by almost 25 basis points on the HSH.com Mortgage Rates Radar, and the site believes now would be the perfect time for homeowners to refinance and for new buyers to qualify for a larger mortgage at a lower monthly payment.
“Many New Year’s resolutions come with a commitment to pay down debt,” continued Gumbinger’s statement with his trademark eloquence. “One method of permanently canceling debt is to refinance to a shorter-term mortgage, trimming years off the term and savings thousands of dollars in interest costs at the same time. In some cases, this can be done for virtually the same monthly payment, possibly less, and is a great way to get your long-run finances rounded into shape.”
According to its weekly releases, HSH.com’s Weekly Mortgage Radar takes into consideration the average interest rates and points on both 30-year fixed-rate mortgages and 5/1 adjustable-rate mortgages, both with conforming balances of $417,000 or less. The site’s wraparound week begins on Wednesdays and ends on Tuesdays, with fresh updates released each Wednesday. HSH’s survey is designed to help mortgage borrowers find the lowest possible rates on their home loans, despite ever-changing market conditions.