|
||
| Currently record low mortgage rates weren’t always so low. Fixed rates have previously been more than 18 percent.Last week, mortgage rates reached their lowest levels in decades. Freddie Mac reported that the average 30-year fixed rate mortgage fell from the prior week to 5.98% — its lowest point since Freddie started tracking rates. The Mortgage Bankers Association of America (MBA) reported that record low rates have pushed mortgage loan applications to their highest point ever.
While today’s low rates have only been previously experienced by those who have lived at least four decades, mortgage rates at one time reached levels that might today be considered predatory. Phil Colling, an economist for MBA, recently noted that mortgage rates are the lowest they have been in 40 years. Forty years ago, the Beatles released “Love Me Do.” Mortgage rates reached 18.45% in October 1981, according to Freddie (remember listening to the pre-solo Sting with the Police in “Ghost In The Machine” about that time?) Freddie reports that rates stayed above 12% until 1985, and eventually fell below seven percent in 1993 — about the time Nirvana was rocking the airwaves. More recently, the 30-year peaked out at 9.20% in December 1994, and has drifted between seven and nine percent for much of the time since. The 30-year has seen a life of excess, with many ups and downs. However, the 30-year is currently clean and sober, and its future looks up for now. |
Sam Garcia has been in mortgage lending since 1980, and is publisher of MortgageDaily.com. He also owns and operates CloseNow.com, a real estate portal site.
email:Â SamGarcia@MortgageDaily.com
