Financing in 33619>Question Details

Eric Guerra, Home Buyer in Riverview, FL

Are FHA interest rates going to go up or down this week for a 30 yr. fixed?

Asked by Eric Guerra, Riverview, FL Tue Feb 26, 2008

My fiance and I signed a contract on an inventory home but left the interest rate on the mortgage contract as floating. At the time, FHA's 30 year fixed rate was 6.25%, when 2 weeks ago it was 5.75% which looked much better when we got the estimate. It now looks like its at 6.5%. My question is, do you think the FHA interest rates will be going down, up, or stay level through this week and next week? We have until Friday to lock in a rate, and I am gambling that the rate will go down to at least back to 6.25% this week. With inflation talks abound, my take is investors are dumping bonds, making the interest rate rise. Bonds go up, rates go down/bonds go down, rate go up. Your thoughts?

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Your guess is as good as mine. Trying to play the "lets wait and see" game for a 1/4 point is not really going to help you all that mouch on your monthly payment. I would say lock it now just in case it keeps going up. For better information I would talk to you lender. He or she will be able to help you out a lot better than anyone else.
1 vote Thank Flag Link Tue Feb 26, 2008
ask them to reconsider the lock....rates went down to 5.5% today for FHA
0 votes Thank Flag Link Thu Feb 28, 2008
Hey, just an UPDATE! We waited and waited and now we locked in at 6%!!! Thursday Feb 28th, the rates went down to 6%!! We are so excited, we already signed the contract to the house and now we're just waiting to be approved! Whoo hoo! Perfect time to buy too!
0 votes Thank Flag Link Thu Feb 28, 2008
6.5% is high for a FHA rate. The reason you're getting a higher rate is due to using the builder's lender. Those 'free incentives' weren't fee as they will get you with a higher interest rate or higher home price.
Current FHA Par rates are at 5.75-5.875%...which you should get no higher than 6%.
Rates are scheduled to continue on going higher, and when the FED cuts the fed funds rate, then the rates will go up again.
0 votes Thank Flag Link Wed Feb 27, 2008
Thirty-year mortgage rates have surged nearly 1.00% higher since setting mid-January lows; the sharp increase in rates was five standard deviations greater than the average monthly mortgage rate move. Statistically speaking, a five standard deviation event is supposed to occur roughly 0.0001% of the time. Interesting times, indeed.
0 votes Thank Flag Link Tue Feb 26, 2008
At this point, it has already moved quite a bit, most of the rate changed we have had were around the 14th 15th - 19th, we saw about a 1/2 difference to the rate. if they loan was NOT locked anywhere in that time, what the hey, ride it out, and have your lender wait to lock.

Until then, you can follow the market at the link below.
There are more than one index that affects the bond market, but this is the best FREE internet resource I have found. We Subscribe to a Bond Market update saving our clients costly swings like those that happened in the last few weeks.

Most lenders ARE NOT willing to send the extra money for the service.

Best of luck to you & your fiance Eric.
Katrina Madewell
0 votes Thank Flag Link Tue Feb 26, 2008
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