Will low interest rates bring buyers back to the table
Conforming 30 year fixed rates mortgage loans have dropped considerably this past week. Locally Citibank and Countrywide are offering a 30 year fixed conforming loan for 4.875% with a cost of 2.250% and 2.000% respectfully.
Will these never before seen interest rates prompt buyers back into buying again or will they sit on the sideline in hopes of obtaining the rumored 4.5% government subsidized rate when the new Obama administration takes office.
Below is a chart obtained from MSN Money detailing available rates, fees & points available in the greater Seattle-Tacoma area.
Loans shown are 30-yr. fixed conforming loans available in Seattle-Tacoma, Washington.
| Financial Institution | Base Rate | APR | Fees($) | Points | Lock | |
| Citibank | 4.875% | 5.111% | 809 | 2.250% | 60 days | |
| Countrywide | 4.875% | 5.114% | 1375 | 2.000% | 30 days | |
| Wells Fargo | 5.125% | 5.325% | 700 | 1.625% | 60 days | |
| Washington Mutual | 5.000% | 5.371% | 929 | 0.875% | 60 days | |
| Chase | 5.125% | 5.383% | 1464 | 2.125% | 60 days | |
| Countrywide | 5.250% | 5.402% | 1375 | 1.000% | 30 days | |
| Citibank | 5.125% | 5.480% | 809 | 1.000% | 60 days | |
| Bank of America | 5.250% | 5.484% | 1400 | 1.875% | 30 days | |
| Wells Fargo | 5.375% | 5.486% | 700 | 0.875% | 60 days | |
| Chase | 5.375% | 5.544% | 1464 | 1.125% | 60 days | |
| National City Mortgage | 5.375% | 5.606% | 1034 | 2.000% | 60 days | |
| Washington Mutual | 4.750% | 5.727% | 929 | 2.125% | 60 days | |
| National City Mortgage | 5.625% | 5.765% | 1034 | 1.000% | 60 days | |
| Wells Fargo | 5.750% | 5.782% | 700 | 0.000% | 60 days | |
| Washington Mutual | 5.500% | 5.793% | 929 | 0.000% | 60 days | |
| ss="s6">Chase | 5.750% | 5.818% | 1464 | 0.000% | 60 days | |
| GMAC Mortgage | 5.625% | 5.868% | 1225 | 2.000% | 60 days | |
| Citibank | 5.750% | 6.038% | 809 | 0.125% | 60 days | |
| National City Mortgage | 6.000% | 6.048% | 1034 | 0.000% | 60 days | |
| Quicken Loans | 6.125% | 6.275% | 1400 | 0.875% | 30 days | |
| Bank of America | 6.125% | 6.287% | 1400 | 1.000% | 30 days | |
| GMAC Mortgage | 6.125% | 6.291% | 1225 | 1.125% | 60 days | |
| Countrywide | 6.250% | 6.315% | 1375 | 0.000% | 30 days | |
| Quicken Loans | 6.500% | 6.568% | 1400 | 0.000% | 30 days | |
| Bank of America | 7.250% | 7.321% | 1400 | 0.000% | 30 days |
With rates this low, anyone looking to purchase a primary residence or investment property definitely needs to look to the foreclosure auction and short sales or REO/bank owned properties to get twice the financial benefits. By buying a distressed property you can pick up a new home at discounts of 20-45% under today’s market value. Combine that with never before seen low interest rates and you can increase your buying power dramatically.
