Low Mortgage Rates, Great for Buyers

According to this article in the AP, mortgage rates have dropped to a record low this week. The average 30 year fixed-rate mortgages dropped to 4.85% this week. The rates fell again after the Federal Reserve said it will give $1.2 trillion into the economy to lower the rates and loosen credit. Mortgage applications had a surge, but 80% of these applications were from borrowers looking to refinance and reduce mortgage payment.

In Freddie Mac's survey, the average rate on a 15-year fixed-rate mortgage dropped to 4.58 percent this week. Rates on five-year, adjustable-rate mortgages fell to 4.96%. Rates on one-year, adjustable-rate mortgages rose fell to 4.85%.

Bottom line: if you are planning on purchasing a home or have the means to do so, jump on this now. I know I've been searching. My real estate professor last semester told me to avoid those adjustable rates though.

[image via frontdoor.com]