Mortgage interest rates for Orange County Home Buyers and Home Owners remain low. With much uncertainty about mortgage rates and what will happen in the next few months, Orange County homeowners got a pleasant surprise as Mortgage Backed Securities actually rallied during the week. Rally’s are good. This means investors purchased Mortgage Backed Securities, pushing prices higher. Interest rates go in the opposite direction and dropped.
Interest rates are hovering in the 5% range for the perfect borrower on a 30 year fixed mortgage. Keep in mind that rates vary quite a bit based on credit, equity or down payment, and purpose of the loan. The 15 year fixed rate program was even low, averaging closer to 4.5% for borrowers paying approximately .75 points.
Should Orange County Homeowners Refinance now?
With interest rates so low, now is the time to refinance for those who haven’t already and are eligible. Tightened underwriting guidelines, combined with the drop in property values has prevented many homeowners from taking advantage of low rates. But there are still people who are sitting on the fence who should act quickly. Analysts estimate that if not for the Fed’s Mortgage Backed Securities purchase program, mortgage rates would be at least 1% higher right now. That program is set to end on March 31, 2010. When that happens, interest rates are expected to climb to over 6%. Actually, as we get closer to that date, the market will begin to react in anticipation of that date. There is still an outside chance that the Fed will change their stance and continue the program, but why risk it?
Orange County homeowners who have a 2nd mortgage (fixed or Home Equity Line) should seriously consider combining their loan with their 1st Mortgage. There are reasons why some people may not want to combine their mortgages, but it is worth checking into. Better yet, take a look at combining the loans into a 15 year fixed in the 4.5% to 5% range.
Authored by Tim Storm, an Orange County, CA Loan Officer – Please contact me for more information about an Orange County, CA home loan. 877-786-4243 x 7.
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* Licensed by Department of Corporations under the California Residential Mortgage Lending Act. PRMI Branch License 813F487.
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