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Mortgage Rates Today: Greece Struggles to Form Government Sending Interest Rates Lower
 

Mortgage Rates Today: Greece Struggles to Form Government Sending Interest Rates Lower

Bond yields and the stock markets are plunging on news that Greece is struggling to form a new government. 10 year bond yields are down 5 basis points to 1.82%, touching the 2012 low of 1.79% set in February of this year. Lower bond yields will force current mortgage rates lower from already low levels set in 2012.

Current mortgage rates today which are averaging 3.79% will head even lower in the coming days. Just last week fixed rate conforming mortgages on both 30 year and 15 year loans made new lows in Freddie Mac's Primary Mortgage Market Survey (PMMS).



This week's PMMS report will be released Thursday at 10:00 am will undoubtedly contain new record lows for both 30 year and 15 year loans. It will be interesting to see if mortgage applications will pickup for both home purchases and refinances since rates continue to make record lows.

Many homeowners who have refinanced in the past year might be enticed to refinance again since 30 year mortgage rates can be found at low as 3.50% with points. There was a big wave of refinancing early in 2011 when 30 year rates dipped below 5.00%.

Back in the first quarter of 2011 when interest rates made new lows 95%of homeowners refinanced to a fixed rate mortgage. Many homeowners also refinanced to a shorter term loan. The borrowers who refinanced to payoff a 30 year fixed rate loan, 34% chose to finance to a fixed 15 year or 20 year loan. See Freddie Mac's "Fixed-Rate Mortgages Dominant Choice of Refinancing Borrowers for more information.

Ultra low refinance rates have made shorter term mortgages like 15 year or 20 year loans much more affordable. Unfortunately many more homeowners don't have enough equity in their home to refinance and take advantage of the lowest mortgage rates/refinance rates in a generation.
Author: James Martin
May 8th, 2012