Local mortgage planner John Schutze gives his weekly market update:
“Mortgage rates end the week unchanged from last week¦Slower than average economic growth and low inflation persuaded investors to purchase bonds, including mortgage-backed securities. Following three months of declines, mortgage rates appear to be settling into a range so far in September.
The most significant economic data released during the week was the monthly inflation reports. Rising inflation erodes the value of bonds and pushes mortgage rates higher. In the current economic environment, higher inflation is not a concern, and some investors are more worried about the risk of inflation falling too low. The Fed is generally most comfortable when core inflation is rising at an annual rate between 1.0% and 2.0%. In August, the core Consumer Price Index (CPI) increased at a low 0.9% annual rate. While this level is probably not low enough to prompt new action from the Fed, investors will be closely watching what the Fed has to say about inflation rates at next Tuesday’s meeting.
30 Year Fixed: 4.375 %
15 Year Fixed: 3.75 %
FHA 30 Year: 4.25 %
VA 30 Year: 4.25 %
5 Yr ARM: 3.5 %
Jumbo 30 Year Fixed: 5.5 %
Jumbo 5 Yr ARM: 4.375 %
30 Year Home Equity: 4.75 %
The above rates are based on a $120,000 Loan Amount with a 1% Origination Fee and 720 credit score (660 score for FHA and VA loans). Some programs require slight adjustments for smaller loan amount
John™s team helps Austin area buyers plan their mortgage future. Check out his Austin mortgage blog.