In the US the Current Mortgage Rate has remained at about 6.5 percent in spite of the fluctuations, that have been the order of the day. There were a lot of variations that took place in the last ten months or so in the US, with regards to the Current Mortgage Rate. The prices of the mortgages went up, rather unexpectedly, during the month of May, in the last year in the US.
The sudden increase in the rates made the mortgage loans even more beyond the reach of the borrowers. In the US the thirty year loans that are taken on the basis of fixed rate are currently available at about 6.78 percent. These loans are amongst the most popular options for the purchase of homes in US.
The fifteen year loans, that are premised on the fixed rates are currently to be had at 6.46 percent. The bigger loan amounts in the region of four hundred seventeen thousand US dollars, and are popularly known as the jumbo loans, are now being sold at a 7.02 percent interest rate.
With regards to the average thirty year loans, taken at fixed rates, the borrowers may need to pay as much as six hundred and fifty dollars, every month, for every hundred thousand.
This payment is supposed to be thirty eight dollars more than what the borrowers had been paying in the middle of March, when the mortgage rates were supposed to be lesser than 6.2 percent. However this payment is also lesser than what was being paid at the month of July, last year, by at least six dollars per month.
Since the month of May, last year the value of the thirty year adjustable rate mortgages have also gone up. It was found that these were being sold in two separate denominations. For the ones with the interest rates guaranteed for a five year initial period, the interest rate was 6.54 percent.
The ones where the interest rate was to be fixed initially, for a year only the interest rate was 6.27 percent. The spread, which is the term used to describe the difference between the adjustable rate mortgages and the fixed rate mortgages is smaller than what is normal.
The five year adjustable rate mortgages do not enable the borrowers to save more than fifteen dollars. In view of the future resettlement of the loans the borrowers consider this to be an insignificant amount. This is precisely the reason why only ten percent buyers opt to buy their houses with these five year plans.
The number of homeowners, with the adjustable rate mortgages, and trying to refinance those mortgages with a fixed rate is gradually growing. The increase in the costs of labor has led to the sudden upsurge of the mortgage prices, according to the US financial experts. It is being speculated by the investors and the lenders that the levels of inflation might well have gone out of hand.
In spite of the Consumer Price Index going up by as much as 2.5 percent, the last year the increase in the prices of various commodities like food as well as higher energy have contrived to increase the mortgage rates by as much as 5.5 percent in the last year.
Last time the inflation happened the Federal Reserve pushed up the interest on all types of consumer loans, thus making it harder for the businessmen to spend.
Last Updated on : 24th August 2013