Prevailing Sonoma County Home Mortgage Rates – August 7, 2009
August 7th, 2009 categories: Mortgage Rates
Prevailing Sonoma County Home Mortgage Rates – August 7, 2009
Good news is bad news?
The unemployment rate is a market mover. On the first Friday of every month the government announces the unemployment rate and many other statistics about the employment situation for the previous month. We got the Unemployment rate announcement for July of 2009 today and it was far better than expected. That was”Good News”.
Good news, unless you are thinking about buying a home. Why? Good news for the economy creates a rally in the stock market. Money flows there as confidence builds in the strength of the economy. Where does that money come from? It comes from the sidelines and the credit markets. Money flows out of the treasuries, where the cost of money is established each day. This pushes mortgage rates up. That’s the “Bad News”.
(This chart courtesy of Mortgage Daily News)
Want to learn more about mortgage backed securities? This link has a great explanation: http://www.mortgagenewsdaily.com/mortgage_rates/mbs-basics.aspx
Mortgage Rate Trend
As you can see above, the trend is up. And as result of all this, mortgage rates are the highest they have been since December of 2008. In eight short months we have gone from historic lows to recent highs. Pay special attention to the 10 Yr. as it it’s pricing gives the greatest indication of where mortgage rates have been and are going.
We were providing mortgages at 4.5% and now we are approaching 5.5%. This is a real blow to the real estate market. But as negative as that sounds, and I apologize for that, they are going higher. Prediction is for higher rates by December.
What are you waiting for?
Is buying a home still a good idea? Of course it is! Who cares what rates are at if you can buy something at half its recent value? Home prices are so low who cares what the rate is.
If they try to charge you for this service, keep on walking and find another lender who will help you. Knowledge is power and the informed buyer always saves money!
The following rates were quoted for a sample conforming loan with the following criteria: $300,000 Loan Amount | 80% LTV (Loan To Value) | 680+ FICO Score
15 Year Fixed Rate Mortgage – 5.25% (5.71% APR)
30 Year Fixed Rate Mortgage – 5.375% (5.58% APR)
1 Year Adjustable Rate Mortgage (1 Year ARM) – 4.875% (3.98% APR)
5/1 Adjustable Rate Mortgage (5/1 ARM) – 5.00% (4.59%APR)
7/1 Adjustable Rate Mortgage (7/1 ARM) – 5.125% (4.98% APR)
Article Contributed by: Dave Raffi, Regional Manager at Mission Hills Mortgage: 707-303-2933
Make sure you tell Dave that the Sonoma County Grapevine sent you!
* DISCLAIMER: These mortgage interest rates are quoted at a specific time, 08.07.2009. Interest rates are subject to change upon changes in market conditions and borrower qualifications.
Now that you are caught up on the latest mortgage rate news, check out the latest prices of Sonoma County Homes by clicking the appropriate link below:
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