How low can we go? 30 yr fixed at 3.75% with no fees...

By Christine Maurus
    May 17 (Bloomberg) -- Mortgage rates in the U.S. fell to a
record for a third straight week, reducing borrowing costs as
the housing market improves and home-loan defaults decline.
    The average rate for a 30-year  fixed loan dropped to 3.79
percent in the week ended today from 3.83 percent, Freddie Mac
said in a statement. It was the lowest in the McLean, Virginia-
based mortgage-finance company?s data dating to 1971. The
average 15-year  rate decreased to 3.04 percent, also a record,
from 3.05 percent.

.....

So, how low will we go, especially if Eurogeddon takes place?
 
Remember that

A.) that stat is 1 week old,

2.) it's a national average, and

III.) It's not a zero point loan, but one that costs .8x in fees.

The bottom comes when banks can't make any money on a mortgage which so far has been 3.5% for a 30 year fixed rate for near zero fees. Anything below that would (IMHO) be neigh impossible to originate, service, and resell to an investor. ARM loans are lower because they've got a lit fuse.

My .02c
 
Soylent Green Is People said:
Remember that

A.) that stat is 1 week old,

2.) it's a national average, and

III.) It's not a zero point loan, but one that costs .8x in fees.

The bottom comes when banks can't make any money on a mortgage which so far has been 3.5% for a 30 year fixed rate for near zero fees. Anything below that would (IMHO) be neigh impossible to originate, service, and resell to an investor. ARM loans are lower because they've got a lit fuse.

My .02c
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Just like with the stock and bond markets, the MBS market can become very irrational as well.  I didn't think we could get below 4% and then we cracked that lower so who the heck knows where the bottom for 30-year rates is.  That being said, I think that in Japan you can get a long term fixed mortgage in the 2% range so anything is possible.  To me, any rate below 3% is effectively an interest free loan due to inflation.  Penfed used to have a 5-year car loan at 2.49% and they recently lowered that rate to 1.99%.  Will we have the Japanese lost decade 2.0?
 
WoodburyDad said:
LAtoOC said:
.....

So, how low will we go, especially if Eurogeddon takes place?
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The 10 is @ 1.70 today, a seven month low
I?m hoping it will break thru the record low of 1.67
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If it breaks 1.67%, we'll probably get down to around 1.50%.  The big question is can we get down to 1.00% (I don't know if we'll get below 1.50% but if Germany did it who knows).
 
Just came to an agreement on a 15yr fixed at 2.875% with $515 in lender fees (not including 3rd party fees).  Sharing for benefit of others...
 
cash92104 said:
Just came to an agreement on a 15yr fixed at 2.875% with $515 in lender fees (not including 3rd party fees).  Sharing for benefit of others...
Click to expand...
With inflation running at least at 3% per year, that's effectively an interest fee loan (on a real basis).
 
cash92104 said:
Just came to an agreement on a 15yr fixed at 2.875% with $515 in lender fees (not including 3rd party fees).  Sharing for benefit of others...
Click to expand...

thanks for sharing...which lender?
 
rkp said:
cash92104 said:
Just came to an agreement on a 15yr fixed at 2.875% with $515 in lender fees (not including 3rd party fees).  Sharing for benefit of others...
Click to expand...

thanks for sharing...which lender?
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Provident has 15yr fixed rates at 2.75% at 0pts plus lender fees.  https://www.provident.com/  You better be squeaky clean because they are one of the most strict lenders out there.
 
rkp said:
cash92104 said:
Just came to an agreement on a 15yr fixed at 2.875% with $515 in lender fees (not including 3rd party fees).  Sharing for benefit of others...
Click to expand...

thanks for sharing...which lender?
Click to expand...

National Bank of Kansas City.  I just did a search on bankrate.com (or maybe it was google's service when they were still active) and called the lowest advertised rate.
 
Wow, the 10-year bond is at 1.54% as I speak.  I thought that 1.50% was going to be as low as might be able to go, but maybe we can go down to 1% just like Japan.
 
irvinehomeowner said:
I just saw a Greenlight commercial on TV this morning with a 3% no-cost loan... redic.
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That can't be for a 30-year fixed...probably either a 15-year or 20-year fixed (which is a touch high).  The 30-year fixed should be available at around 3.50% no points or a small credit (depending on the lender that you go with). 
 
Yeah... not sure of the term as I caught it right before it finished.

So now we're at 3.5? So funny because they keep making the impossible possible.
 
After yesterday?s drop, I expected the 10 would rally today.
Very happy to see it drop even further.
It got away a few weeks back (climbing up to around 2) but has come down considerably making new lows.

 
WoodburyDad said:
After yesterday?s drop, I expected the 10 would rally today.
Very happy to see it drop even further.
It got away a few weeks back (climbing up to around 2) but has come down considerably making new lows.
Click to expand...
The German 10-year bund was below 1.25% earlier today.  One thing I have learned is to expect the unexpected.
 
irvinehomeowner said:
Yeah... not sure of the term as I caught it right before it finished.

So now we're at 3.5? So funny because they keep making the impossible possible.
Click to expand...
Yeah, we are solidily at 3.50% at par or with a small credit (looking at provident and amerisave).
 
Without paying a fee, it's difficult to get live MBS prices. Try mortgagenewsdaily.com. They have very sharp data that's free. If you want the live stuff though it's pretty spendy.

Greenlight's website posts rates, but you're better off with Provident or Amerisave given the customer service ratings. That 3.0% rate is a 10 year fixed not 30.
http://www.greenlightloans.com/greenlight/web2/OurRates.html

 
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