Current low mortgage rates eased even further today as a result of the recent MBS rally that lasted for a few days this week.

Although todays conforming 30 year fixed mortgage rates remain at 4.250%, conforming 15 year fixed mortgage rates dropped by .125% and are at 3.375%, which is a new low for 2011. 5/1 ARM loan rates saw the same decrease of .125% and are at 2.625%. With mortgage rates dropping, more borrowers will be looking at reducing their 30 year mortgage to 15 years, while others will be looking closely at the adjustable rate mortgage market. These low mortgage rates with 0.7 to 1% origination fee can be obtained by those who have maintained good credit and can produce documentation for lender approval.

FHA mortgage interest rates saw no changes today, but are still at attractively low levels. Current FHA 30 year fixed mortgage interest rates are at 4.250%, which is still the same as conforming 30 year fixed mortgage rates. FHA 15 year fixed mortgage interest rates are at 3.750% and FHA 5/1 ARM loan rates are at 3.000%. Even though some conforming mortgage rates are lower than FHA mortgage rates, consumers are still turning to FHA mortgage loans for financing. Borrowers are able to combine FHA required down payments, which are as low as 3.5%, with approved gifts and housing grants for a more affordable transaction. These benefits outweigh the higher FHA closing costs (APR) due to various FHA fees and the upfront mortgage insurance premium.

Decreasing by .125%, todays jumbo 30 year fixed mortgage rates are at 4.875%. Jumbo 15 year fixed mortgage rates are at 4.500% and jumbo 5/1 ARM loan rates are at 3.625%, both remaining the same. Jumbo mortgage loans are necessary for financing above the conforming loan limit, which is currently $417,000 to $729,750 depending on location of the property. These limits are set to decrease in October which will put more homes into the jumbo mortgage market. Right now, borrowers can obtain these low jumbo mortgage rates with 0.7 to 1% origination point.

Current Wells Fargo California 30 year fixed mortgage interest rates are at 4.500 (4.686% APR).

MBS prices (mortgage backed securities) are down slightly today -5/32 (FNMA 30 yr 4.0 at 100.30). Mortgage rates move in the opposite direction of MBS prices. Todays drop in mortgage rates is the result of several days of MBS price increases. Todays big report mover is the weekly jobless claims which dropped by approximately 22,000. Investors turned to the stock market which is currently up. Markets may soon become volatile if a debt ceiling agreement is not made as we get closer to the deadline date.

 

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