Home mortgage rates have stayed a bit higher for the week of February 22 versus January 2013, but they are not as high as was expected at the beginning of February. The average for the 30-year fixed mortgage stayed put near 3.625 percent for most lenders combined. Much of the slack in the sails has been the deficit of any major market movements in recent weeks aside from a lot of chatter about the federal sequestration. Now that reality is setting in, even that risk to the economy is now being downplayed as the reality of what government cuts will hit when is not looking near as dire as the prognostications in the media first made them out to be.
Lenders who were hoping for rising rates at the beginning of the month are finding themselves let down, with frustration running rampant through the market watchers at the end of this week. There isn’t anything for anyone to hang a hat on and become a market leader, charging higher rates than the group. Granted, the U.S. Treasury has begun raising its interest rates offered on government bonds to keep attracting buyers, but it hasn’t been any kind of a stellar climb to take much notice of. Most of the market is instead sitting on the fences, waiting for a stronger signal to begin agreeing a push upward in mortgage rates is warranted.
Lenders talking amongst themselves and the media are still pushing the need for consumers to utilize a rate lock when borrowing to protect the rate agreed to now versus being exposed to a higher charge because of waiting longer. The general consensus is that at some point in 2013 the rates will reach a new, higher floor. This is a different strategy from the historical use of a lock in the last few years; the loan rate lock won’t really do anyone any good expecting a drop in mortgage rates, at least according to the lender group perspective.
At the end of this week the other mortgage categories closed as follows: the 15-year fixed mortgage average hovers between 2.875 percent and 3 percent, the 5-year adjustable rate mortgage average is a bit lower at 2.625 percent and 3.25 percent, and FHA/VA loans are averaging between 3.25 percent and 3.5 percent.