Over the past 5 decades 30 year fixed mortgages have on average been 8.6% In the few years leading up to the financial crisis they were lower, about 6%. Over the last few years the Fed has jumped in and put a cap on rates causing us to see extremely low rates. For almost a year we were staying at about 3.5%.
Because the decision was made from the federal government to step away controlling the rates banks were offering, due to the financial situation stabilizing in the country we have seen an increase of rates. As of today we are seeing rates between 4.25 and 4.75%. Over the last few months this has been a big increase, but looking back historically these are still very low rates.
In the Future:
Both of the Chief Financial Officers for Freddie Mac and Fannie Mae came out with statements this months saying the Fed would not be concerned to see rates between 6 and 7%. This news has a lot of experts concluding that interest rates will continue to rise over the next year.
What this means to you:
If you are currently a homeowner this news may be comforting, knowing that the national economy is stabilizing and rates are headed back to historic levels. If you are thinking about buying this news may encourage you to start the process as soon as possible. Interest rates can make a big difference on your monthly payments and how much house you can afford.