Today is Wednesday, 10/08/2008. This morning the Fed dropped interest rates by 0.5%. I was quoted 6.5% in good faith when I started. Last week the markets were horrible, and my floating rate went all the way down to 6%. Now, it’s right back at 6.5%! I have exactly 2 weeks to lock in my rate. I am afraid that, if I wait, I will be forced to pay an even higher rate than what I started with. Please advise.
Asked by:Renaldo H
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I would wait, I think they are going to bring rates lower to attract more buyers.
See if you still can lock it in a 30-year. We were told that you can only lock in a 5 year because of the economy. That is a standard. The loan officer can tell you one thing. But if you didn’t lock it in last week you may be screwed.
Do you have a floating rate option? If so, lock in the lower rate now and follow with the bank everyday. If it goes down to 6% make that your final rate.
I would lock it in. 6.5% is not that bad, and even if you are lucky it might get back to 6.0%. If you are happy with 6.5% which is what I locked in I would do it. It is easy to look back in 1-5 years to know what you should have done, but I think you would be safe @ 6.5%.
You want to wait – I work with mortgages and modifications.
6.500 -1.742 -1.492 -1.367 -1.117
6.375 -1.679 -1.429 -1.304 -1.054
6.250 -1.568 -1.318 -1.193 -0.943
6.125 -1.341 -1.091 -0.966 -0.716
6.000 -1.063 -0.813 -0.688 -0.438
5.875 -0.675 -0.425 -0.300 -0.050
5.750 -0.345 -0.095 0.030 0.280
5.625 0.034 0.284 0.409 0.659
FHA 30yr fixed rate pricing at 6.5% – shows your broker making 1.742% of your loan amount in YSP. Hopefully there is no loan origination fee. You should tell your broker you want to buy down the interest rate.
I he argues with you, check out interest rates on bankrate.com
I’m planning on refinancing as well, the rates I believe are going to drop lower, until the presidential election. This cycle happens every four years – it’s funny how people forget………
Just like every October the gas prices come down…………..
a tolerable rate is not what you seek; a good rate is what you seek.
I do not know your circumstances but it is it essential that you close
escrow by a certain date or lose an earnest money deposit
or down payment?
if no loss, wait………rates will go down lower.
When you wait for rates to drop you are gambling that they will not go up.
The feds lowered the rate today,so if it was me, and it is your money I am gambling with, I would wait. The lenders will feel the drop soon, therefore passing it on to you.
Thanks for allowing me to gamble with your money, it felt so good.
I would be interested to know how this came out please let me now via e-mail.
I hope this has been of some use to you, good luck.
‘FIGHT ON”
The Fed dropping the short term interest rate has no effect on your mortgage rate, those are tied to the LIBOR rate.