On August 28, the Federal Housing Finance Agency (FHFA) reported that, overall, mortgage interest rates were flat in July. To a large extent, the same was true for the subset of loans used to purchase new homes. Between June and July, the average contract interest rate on conventional mortgages for new homes ticked down, but only from 4.14 to 4.12.
Meanwhile the initial fees on these loans were also basically unchanged at 1.20 percent in July (compared to 1.18 in June). The result was an average effective interest rate on new home loans (which amortizes initial fees over the estimated life of the loan) that went from 4.27 to 4.25 percent.
This information is based on FHFA’s Monthly Interest Rate Survey (MIRS) of loans closed during the last five working days in July. For other caveats and details about the survey, see the technical note at the end of FHFA’s August 28 news release.
This post was originally published on the NAHB blog, Eye on Housing.
Reprinted with permission from RISMedia. ©2014. All rights reserved.
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