Home Loans: US rates fall after Fed announces QE2
Average mortgage rates dipped following last week's Federal Reserve decision, according to the LendingTree Weekly Mortgage Rate Pulse, a snapshot of the lowest and average mortgage rates available within the LendingTree network of lenders.
On 9 November, average home loan rates offered by LendingTree network lenders decreased week-over-week to 4.34 percent (4.56% APR) for 30-year fixed mortgages, 3.72 percent (4.05% APR) for 15-year fixed mortgages and 3.24 percent (3.53% APR) for 5/1 ARMs.
Average rates for 30-year fixed rate VA loans, home loans offered to veterans and active U.S. military members, were 4.28% (4.52% APR). LendingTree makes finding a VA loan simple by matching veterans with VA-approved mortgage lenders.
On the same day, the lowest mortgage rates offered by lenders on the LendingTree network were 3.75 percent (3.94% APR) for a 30-year fixed mortgage, 3.25 percent (3.49% APR) for a 15-year fixed mortgage and 2.625 percent (3.13% APR) for a 5/1 adjustable rate mortgage (ARM). Rates for 30-year fixed home loans and 5/1 ARMS fell week-over-week while the 15-year mortgage rate remained flat.
"As expected, the Federal Reserve's decision to pursue quantitative easing has driven mortgage rates down this week," said Cameron Findlay, LendingTree chief economist. "However, the current coupon spread has widened since April from 113 basis points to more than 170 basis points, a 50 percent increase. With spreads this wide, lenders have more flexibility in pricing mortgage rates so borrowers should make sure to shop around to ensure they're receiving a competitive rate before locking it in."
LendingTree has published a state-by-state comparison of rates at www.lendingtreee.com
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