On one hand we have hints of an improving economy but on the other we have news from Freddie Mac that the 30-year mortgage rates have hit rock bottom, at least close to that. They are at a new low of 3.49 %, which is lower than the last recorded 3.53% (last week). Along with this, the 15-year mortgage, which most refinancers prefer also set a record at 2.80%.
The bad employment situation in the country has been and is still one of major reasons for this drastic reduction of rates. According to Frank Nothaft, vice president and chief economist, Freddie Mac, “Market concerns over the strength of the economic recovery brought long-term Treasury yields to new lows this week allowing fixed mortgage rates to reach record levels.”
Even though the unemployment rates have reduced over the past couple of years, the number of jobs that have been added to the economy are considerably negligible. People have not yet found enough stability in the market and in their lives to invest in homes.
Also, since the mortgage rates are low and volatile, investors have been on the lookout for safer places to invest their funds. Among the most popular has been the Treasury Notes, which are considered a safer bet.
Analysts are predicting that the mortgage rates may not remain this low for too long. So if you are planning to buy a house, this is a good time to invest. Though, be advised to consider your long-term economic stability before you commit to buying your dream home. Also, as we always recommend, don’t forget to fill correctly your Form 4506-T.