Mortgage Rates Continue Falling


The mortgage rates dropped for a second week in a row. They have hit their lowest levels since the beginning of the year. The downward trend may remain for longer, despite the predictions that the home loan rates will rise considerably in 2014.

In the week ending April 18th, the rate on a 30-yeard fixed mortgage fell from 4.375% to 4.27%. The decrease of slightly over 0.1 percentage points is not very large, but it is quite significant given that it has occurred on a weekly basis. The rates on all other types of home loans went down as well. The 15-year fixed mortgage rate is now 3.33% while last week it was 3.38%. The average rate on the 5-year adjustable home loan fell from 3.09% to 3.03%.

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The fees for home loans did not undergo any changes during the week. The fee for a 30-year fixed mortgage remained 0.7 points while that for a 15-year fixed loan stayed at 0.6 points. In general, the fees are not as sensitive to economic and market changes as rates.

The main reason for the falling mortgage rates is the slower than expected recovery of the economy. Job growth was achieved in March, but it was smaller than predicted. Inflation rose as well, but not as much as expected. The instability in the international financial markets has had a positive impact on the US mortgage bonds and on the rates as well. Even though the Fed announced reductions in major programs for supporting the economy, now there are clear indications that support will continue.

The soft demand in the housing market has also had a positive impact on the mortgage rates. As home loans are becoming more affordable during the spring house buying season, there are hopes that the demand for homes will increase. Prospect home buyers can readily take advantage of the low rates while they are around.



Christian Calvin mortgage Christian is a contributing writer for He is a graduate from the University of Tennessee with a degree in Communications and a concentration in Broadcasting. Christian has served as vice-president for a privately-held company for more than 20 years. Additionally, he has also applied his writing and business knowledge to various websites with a focus on business and sports news . . . both of which are passions. Christian enjoys playing golf and spending time with his family and friends.


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