There was a lot of talk about a spike in mortgage rates once the Federal Reserve stopped purchasing mortgage backed securities. Well, the purchases ended nearly a month ago, but mortgage interest rates are still really low. In fact, one of the quotes I got emailed me from a lender had rates still below 5% for 30 year fixed mortgages of conventional loans. According to Bankrate.com, the average 30 year fixed mortgage right now is at 5.19%.
The purchase of the mortgage securities by the Federal Reserve created artificial demand which kept interest rates really low. Is there more demand for the mortgage backed securities and treasury bonds? Or does it just take time for mortgage interest rates to react?
According to Greg Mcbride from Bankrate.com, Mortgage rates should remain low for quite some time if the fed raises their overnight borrowing rate as a sign that the economy is improving.
I’m not sure how long this will last, but for now, mortgage rates are still absolutely incredible for people looking to buy Utah Real Estate.
