. This is the 5th week in a row where they have fallen. They are now flirting with the all time historic low of 4.71 reached in 2009. If it were not for 2 weeks in 2009 today's drop would be seeing a lot more headlines than they are currently getting. Suffice it to say that rates are very very low right now.
The 15 year dropped from 4.24 to 4.21. The 5 year arm rose from 3.91 to 3.97 while the 1 year arm fell from 4.00 to 3.95. Below are rates from the weeks from Apr 29, 2010 to May 27, 2010
May 27, 2010
30-fixed 4.78 15-fixed 4.21 5 ARM 3.97 1 ARM 3.95
May 20, 2010
30-fixed 4.84 15-fixed 4.24 5 ARM 3.91 1 ARM 4.00
May 13, 2010
30-fixed 4.93 15-fixed 4.30 5 ARM 3.95 1 ARM 4.02
May 06, 2010
30-fixed 5.00 15-fixed 4.36 5 ARM 3.97 1 ARM 4.07
As we can see rates have steadily being falling through the month of May going from 5.06 to 4.78 since April 29, 2010. It's also helpful to look at actual mortgage payments. We took today's rates and used a mortgage calculator to translate them into a mortgage payment for a 200k loan. We also did the same thing with rates from May 13th and November 12th 2009.
May 27
30-year $1046.91
15-year $1500.51
5-year $951.37
1-year $949.07
May 13
30-year $1065.1
15-year $1509.62
5-year $949.07
1-year $957.13
So in the last two weeks a mortgage payment has fallen 1.7 percent or $18.19 a month for a 200k loan.
So what do we expect for the rest of 2010? Rates can't continue to fall forever. In fact I think it is highly unlikely they will fall below 4.5 percent. So in the short term they are somewhat unpredictable. If the economy improves rates should increase. If the economy encounters more set backs I would expect rates to fall slightly. Long term though I would expect them to increase. The general consensus is that 6 months from now rates should be somewhat higher than what we are seeing today.
