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Christmas is near and Santa’s elves are hard at work delivering low mortgage rates for all the good boys and girls.  The Fed meets tomorrow and Wednesday with the expectation of dropping the federal funds rate by .50% virtually a lock.  In addition, analysts say there is nearly a 70% chance they will drop the federal funds rate by .75%.  Since the Federak Funds Rate is already at 1%, they are getting closer and closer to paying financial institutions to take money (wink, that will never happen).

Since the immediate reaction in the mortgage market to a reduction in the federal funds rate is often negative, be prepared for some volitility in the mortgage bond market this week.  The rates below are as of 4:00 Central Time on 12/15/08:

  • 5.000%  30 Year Fixed
  • 4.875%  15 Year Fixed
  • 5.000%  30 Year Fixed FHA
  • 5.000%  30 Year Fixed VA

For more information about your loan, call Steve Russell with Primary Residential Mortgage at 850-221-8334.  Or visit www.SteveRussellOnline.com.

*Rates are subject to change without notice.  Click here for the specifics on the rate quotes listed above.

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This entry was posted on Monday, December 15th, 2008 at 5:17 pm and is filed under Gulf Coast Mortgages. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

4 comments so far

 1 

Woohoo! Cheap money, here we come! Let’s just keep those dollar printing presses going. Why not, the dollar isn’t backed by silver or gold anymore, just paper (or should I say ‘thin air’).

December 16th, 2008 at 7:12 am
 2 

I really do think between the low low interest rates and the reasonable price of homes this is a great time to buy assuming you plan on holding for at least 5 plus years.

December 17th, 2008 at 7:47 am
 3 

JCL – There is no doubt that there are serious concerns for inflation when the Treasury Department turns on the printing press. However, if the actions being taken help to stimulate the real estate market (which is a huge portion of the economy as a whole), it could help to push us forward.

I am not a fan of government intervention on any level, just trying to make lemonade with the lemons we have been dealt.

December 30th, 2008 at 8:31 am
 4 

Janice – I agree that it is a great time to buy. Home prices are near 2003 levels and mortgage rates are at historic lows. Based on that, I think the only think holding back prospective buyers could be the uncertainty of the job market.

Contrary to what might be widely accepted in the media, we have no problem loaning money to people with the ability to repay it. The ability to repay really being the key phrase there. The days of stated income are long over, so we are back to more of a common sense underwriting approach like we were 10 years ago. I expect 2009 to be a year of recovery.

December 30th, 2008 at 8:36 am

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