Mortgage Rates Hold Steady Despite Fed Rate Cut
The Federal Reserve’s recent decision to slash the federal funds rate has left many wondering why mortgage rates haven’t followed suit. Despite the central bank’s signal to cut rates two more times in 2024, mortgage rates remain relatively stagnant. According to Zillow, the 30-year fixed mortgage rate has inched up to 5.83%, while the 15-year fixed rate remains steady at 4.97%.
Economic reports set to be released next week, including the job openings report and initial jobless claims, may shed more light on the direction of mortgage rates. Historically, rates tend to increase when the economy is thriving and decrease when it’s struggling.
Current Mortgage Rates:
* 30-year fixed: 5.83%
* 20-year fixed: 5.56%
* 15-year fixed: 4.97%
* 5/1 ARM: 5.89%
* 7/1 ARM: 6.01%
* 30-year VA: 5.25%
* 15-year VA: 5.04%
* 5/1 VA: 5.78%
Mortgage Refinance Rates:
* 30-year fixed: 5.74%
* 20-year fixed: 5.58%
* 15-year fixed: 4.94%
* 5/1 ARM: 5.97%
* 7/1 ARM: 6.25%
* 30-year VA: 5.18%
* 15-year VA: 4.86%
* 5/1 VA: 4.90%
When choosing between a 30-year fixed mortgage and a 15-year fixed mortgage, consider the pros and cons of each. A 30-year fixed mortgage offers lower monthly payments and predictable rates, but comes with higher interest rates and more interest paid over the life of the loan. A 15-year fixed mortgage, on the other hand, offers lower interest rates and saves thousands in interest, but comes with higher monthly payments.
Adjustable-rate mortgages (ARMs) offer a lower introductory rate, but come with the risk of rate increases later on. If you plan to move before the intro-rate period ends, an ARM might be a good option. However, if you’re unsure about the future, a fixed-rate mortgage might provide more stability.
With the Federal Reserve signaling more rate cuts in the future, is now a good time to buy a house? While mortgage rates are expected to decrease, it’s essential to consider your individual circumstances and weigh the pros and cons of buying now versus waiting.
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