Mortgage interest rates vary from year to year, but there is a consensus that the all time lows that have been seen for the past few years can not hold. Predictions of rising rates are leading many to believe that now is the best time to refinancing or to lock in a loan with a low rate. The best way to understand how true this may be is to understand more about mortgage interest rates. A lot of information on interest rates and the indexes that dictate there rise and fall that can be found online, or you could contact a lender to see what kind of interest rate you qualify for. Fill out our free short form to contact up to four lenders about interest rates for your new mortgage.
Apply online to contact up to four lenders about your new mortgage and interest rate.
Second Mortgages allow you to borrow up to 125% the value of your current home. Second mortgages are a great choice in the current economy for two reasons:
More cash on hand allows for more flexibility for situations that arise.
Interest rates are at a historical 30 year low.
There are many indexes that can influence your interest rates:
- Prime Rate is published by the Wall Street Journal and is used for corporations,
large business and other parties with extremely good credit. This rate is
one of the most stable and, for the most part, does not vary from bank to
bank. Since it is often used to predict the rise or fall of rates, when the
prime rate changes it is likely that consumer loans will follow its lead and
so this is a good index to study.
- U.S. Treasury Security Yield is the average of monthly rates of a one, three
or five year U.S. Treasury security. Many adjustable rate mortgages are set
by the average rate of this index. If you are interested in finding more information
on this index, an average of the monthly rates is published annually by the
Federal Reserve Board.
- Federal Funds Rate is most often referred to as the Fed Fund Rate. This
index is set by the Federal Open Market Committee and is used by banks to
set the rate on funds that are loaned from one bank to another overnight.
This index is used to stimulate economic growth. Changes in the Federal Funds
rate effect inflation and economic stability. The Federal Open Market Committee
has to seriously consider the consequences of any changes in this rate. If
it was set too high, it could have the potential to choke economic growth.
Long-term interest rates are greatly effected by this index.
- The 11th District Cost of Funds can be used for adjustable rate mortgages.
Generally parallel to the one-year U.S. Treasury Yields, this index is reported