Author Topic: 30-year fixed mortgage rate reaches highest sustained increase in 40 years  (Read 4794 times)

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Offline WTTCHMN

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Offline USCTrojanCPA

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As quickly as we went over 3% on the 10-year bond, we are back under at 2.93% today.
Martin Mania, CPA
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Offline Soylent Green Is People

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Interesting number for me is the LIBOR index. A 2013 vintage 5/1 ARM loan that has a 2.25 margin if adjusting to market today will enjoy a fully indexed rate of 4.950. YOWZA!

My .02c
 
My .02c

SGIP

Offline qwerty

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Interesting number for me is the LIBOR index. A 2013 vintage 5/1 ARM loan that has a 2.25 margin if adjusting to market today will enjoy a fully indexed rate of 4.950. YOWZA!

My .02c
 

Don’t forget about the 2% cap. Mine would cap at 4.75%

Offline Soylent Green Is People

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In some cases, this is true.

Most ARM's are 5/2/5 - 5% max 1st adjustment, 2% thereafter, 5% lifetime cap from start rate. Some were 5% lifetime cap from 1st adjustment!

If the ARM you have is a 2/2/5, then it's 2% 1st adjustment cap, 2% thereafter, 5% cap from start rate, or 5% from 1st adjustment.

I'm still a big believer in ARM loans. They make sense for many people, but not everyone. Just laying out the possible adjustment in 2018-2019 for some ARMS might be to the upper 4's to low 5's.

My .02c
My .02c

SGIP

Offline USCTrojanCPA

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Glad that my mid-2% 7-year ARM doesn't reset until 2023 so between then and now I'm sure we'll have some kind of recession where rates will dip again which will allow me to refi back into another 7-year or 10-year ARM.
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Offline paperboyNC

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I bought in 2012 with a 7yr ARM at around 3%. Refined recently into another 7yr ARM around 2.5%.

As Us Trojan says, if I stay in my home, I'll refi during the next rate dip.

Offline the.irvine

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Will current trade wars will have any impact on interest rates? It appears that 10YD is down due to similar concerns.


Offline Lallo

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Are ARM loans still worth considering since rates are up?  Do they make sense if someone plans to stay in their next home for the forceable future (5-10 years).  My credit union lists their 7/1ARM at 3.875.

Offline USCTrojanCPA

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Are ARM loans still worth considering since rates are up?  Do they make sense if someone plans to stay in their next home for the forceable future (5-10 years).  My credit union lists their 7/1ARM at 3.875.

A few of my clients got 3.50-3.75% 7/1 ARM rate loans, check with BofA and US Bank.  On average most people sell their homes within 5-7 years so a 7/1 ARM loan makes a lot of sense.  Plus, you can always refi an ARM loan without a prepayment penalty and next time we have a recession rates will be lower (probably back into the 2s for an ARM loan) so I say go for it.
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Offline USCTrojanCPA

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https://www.cnbc.com/2018/06/25/morgan-stanley-says-rates-are-done-going-higher.html?__source=yahoo%7Cfinance%7Cheadline%7Cstory%7C&par=yahoo&yptr=yahoo

And now we are back down to about 4.25% with the heartburn with the Turkish currency...where's the 5%+ rate?  I think we'll bounce around between 3.75% to 4.75% for a while.
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Offline fortune11

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https://www.cnbc.com/2018/06/25/morgan-stanley-says-rates-are-done-going-higher.html?__source=yahoo%7Cfinance%7Cheadline%7Cstory%7C&par=yahoo&yptr=yahoo

And now we are back down to about 4.25% with the heartburn with the Turkish currency...where's the 5%+ rate?  I think we'll bounce around between 3.75% to 4.75% for a while.


Exactly , and this is what I have been saying here for months — don’t let the hoopla of “rising rates “ deter you from buying a house if that’s what keeping you back .

Sidebar  — The fear  of high inflation along with the fetish like fascination for gold and precious metals is very specific to boomer demographic and both ideas will eventually fade away .

Offline Lallo

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I just checked BofA’s website and they list both the 30 yr fixed and the 7/1 ARM at the same rate (4.375). Something’s obviously wrong.

Offline USCTrojanCPA

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I just checked BofA’s website and they list both the 30 yr fixed and the 7/1 ARM at the same rate (4.375). Something’s obviously wrong.

Talk to SGIP, don't trust a website for rates.
Martin Mania, CPA
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