Blog

Welcome to the BeSmartee blog. Enjoy a wide selection of articles related to mortgages, the industry, and real estate.

This Week in Mortgage Rates: Fed Announces No Rate Hike

By Amanda Curry · Jun 15, 2016 · rates

This Week in Mortgage Rates: Fed Announces No Rate Hike

Image courtesy of Flickr, Chatham House

Brexit, will make it difficult for Treasury yield and mortgage rates to rise in the upcoming weeks.

According to Freddie Mac, the 10-year Treasury yield continues to decline this week. Fed's June meeting drove investors to flee towards the safety of government bonds, driving rates down.

The Fed's decision to pause on raising rates, and the growing anticipation for Brexit, will make it difficult for Treasury yield and mortgage rates to rise in the upcoming weeks.

Mortgage rates ending as of June 16, 2016

  • 30 year fixed rate mortgage from Freddie Mac averaged 3.54 percent with an average of 0.5 percent in fees for the week ending June 16, 2016, down from last week's 3.60 percent. A year ago at this time, the 30 year fixed rate mortgage averaged 4.00 percent.
  • 15 year fixed rate mortgage averaged 2.81 percent with an average 0.5 percent in fees, down from last week's 2.87 percent. A year ago at this time, the 15-year fixed rate mortgage averaged 3.23 percent.
  • 5 year adjustable rate mortgage averaged 2.74 percent this week with an average 0.5 percent in feed, up from last week's 2.82 percent. A year ago, the 5-year ARM averaged 3.00 percent.

30 year fixed

15 year fixed

5 year ARM

This week's rate

3.54

2.81

2.74

Fees and Points

0.5

0.5

0.5

Margin

N/A

N/A

2.74

With mortgage rates hovering around all-time lows, there is no better time to refinance or lock in interest rates. Compare hundreds of loans at once.

Fed Announces it Will Not Raise Rates

The Federal Reserve indicated that they would rethink their plans to raise its benchmark interest rate and they stayed true to their word.

The Federal announced yesterday that they have decided to not raise interest rates on Wednesday, June 15th, at the end of its two day meeting. The decision was on par with expectations after a brutal May jobs report. In addition, the Fed cut its forecast for US economic growth in 2016 to 2%, down from 2.2% earlier.

This is the second time this year that the Fed is reducing its expectations for US economic growth. In December, the projection was 2.4%. The projection for economic growth in 2017 was also slightly decreased. The Fed will meet in July, however, expectations are low for any action on interest rates.

Mortgage Applications Fall 2.4% Despite Low Rates

Economic concerns in the US and overseas has pushed mortgage rates low, however, mortgage application volume decreased 2.4% last week from the previous week, according to the Mortgage Bankers Association. Mortgage applications to purchase a home fell 5% from one week earlier but were 16% higher than the same week a year ago. Applications may be weaker due to a lack of homes on the market, rather than interest rate changes.

Refinancing applications, which are typically more rate-sensitive, didn't get a lift either. In fact, they fell 1%, seasonally adjusted, from the previous week. However, they are nearly 52% higher than a year ago, when interest rates are higher.

Upcoming Economic Calendar: European Referendum Vote - Brexit

The anticipation for the European Referendum Vote next Thursday, June 23, 2016, played a part in The Fed's decision to pause rates. Global movers, such as Barack Obama, Angela Merkel and Mario Draghi, are warning Britons not to vote to leave the EU. They predict that the UK will be weaker on its own economically, politically, and diplomatically.

In general, the overseas volatility has been an increasingly important factor for domestic rates markets. The onset of Brexit could have long term implications for the stability of the European Union.

Lock or Float Rates? Some Things to Consider

As always, it is important to lock in a mortgage rate based on the borrower's risk tolerance and their short and long term goals. With that being said, with the risk of rates going up in July, it may be the right time for you to lock. There's much more of a chance of rates going significantly higher than significantly lower.


Real Estate Commission: Explained, Revealed and Compared
By Arvin Sahakian · Aug 17, 2015 · Real Estate Data

Real estate agents receive commissions from home buyers and sellers, collectively earning over $50 Billion per year. Learn how commission amounts are set, who pays them, and how they work in this article. Read more.

197,754

California Property Tax: Complete List by County 2014-2015
By Tim Nguyen · Nov 26, 2014 · Real Estate Data

List of secured property tax rates for all counties of California fiscal year for 2014-2015. Read more.

126,877

California Proposition 60 and 90: Your Complete Guide
By Tim Nguyen · Nov 28, 2014 · Real Estate Data

If you live in California and are over the age of 55 you can effectively reduce your property taxes when buying a new home. Read more.

66,429

What to Expect During the Home Loan Closing Process
By Arvin Sahakian · Feb 24, 2015 · Mortgage

You've heard the term used before, but what does loan closing mean? Find out all you need to know about the process. Read more.

54,323

The Surge in Foreign Real Estate Investment in the United States
By Laura Agadoni · Feb 24, 2016 · Real Estate

Foreign real estate investment in the United States, both commercial and residential, is a huge phenomenon that is only expected to accelerate, maybe even to skyrocket, in 2016. Read more.

50,353

Houston vs. Dallas: Which One is Better to Live in?
By Amanda Curry · Oct 11, 2016 · Real Estate

Houston Vs. Dallas? If you are considering moving to either of these major metropolitan areas, we've created a resource to help you make the decision process a little easier. Read more.

49,159

5 Illegal Borrowing Activities: Things That Are Illegal When You Try to Get a Home Loan
By Laura Agadoni · Jan 22, 2016 · Mortgage

Whenever there is money to be made or money to be spent, some unscrupulous folks will take advantage, trying to game the system or commit all-out fraud. Read more.

48,460

Does Homeowners Insurance Pay Off your Mortgage if the House is Burned Down?
By Amanda Curry · Feb 8, 2017 · Mortgage

In this article, we explore how homeowners insurance works and what happens in the event of a house fire. Read more.

25,892

16 Ways to Improve Your Debt-to-Income (DTI) Ratio
By Veronica Nguyen · Nov 29, 2014 · Mortgage

Your DTI is used by mortgage lenders to determine whether you qualify for a loan, and if so, for how much. Improve your DTI with these 16 tips. Read more.

25,356

5 Tips on Getting a Mortgage Loan after Bankruptcy
By Veronica Nguyen · Apr 15, 2015 · Mortgage

A bankruptcy will make it very difficult to attain a home loan. These 5 tips will help you re-establish your credit quickly in order to qualify for a home loan. Read more.

20,793