by: Matthew Graham
Dec 9 2014, 3:55PM
Mortgage rates fell again today, bringing them very close to their lowest levels in more than a year and a half. US bond markets (including Treasuries and mortgage-backed-securities) continue taking cues from European bond markets where the benchmark 10yr yield just fell to a new record low.
While US Treasuries benefit more than mortgages, there was still enough of a spillover effect to push mortgage rates noticeably lower. Top tier rates for top tier borrowers are now getting back into the high 3's, with 3.875% being the most prevalent conforming 30yr fixed quote today. For the record, 4.0% is not far behind. 3.75% exists, but it's not common and may entail higher upfront costs.
There's not really much to be said about this strength in mortgage rates apart from the fact that "it's nice." It's nice that we're getting enough spillover from all-time low European bond yields and it will stop being nice whenever Europe turns a major corner. Earlier in 2014, Europe was merely a wet blanket keeping domestic rates lower than they otherwise would be, but as the year progressed, it's fair to say Europe has clearly dragged US rates lower.
Those are bigger-picture considerations though, and not likely to play out on a short enough time scale to be relevant to most borrowers' lock/float decisions. In that regard, one of the only tools at your disposal is to simply observe where rates are relative to recent levels and to where you began your process.
Read the entire article at: http://www.mortgagenewsdaily.com/consumer_rates/416048.aspx
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