Mortgage Rates Dip Only Slightly

[Aug 15, 2008.]

 

According to the reports issued by the Mortgage Industry giant Freddie Mac, or FRE, the average interest rates applied to 30 year mortgage loans fell only slightly in recent history, but data regarding the general economy keeps mortgage rates at a higher elevation overall.

Although the rates on long-term home loans have managed to slide down a slight slope recently, they nonetheless managed to remain above a 6% margin on account of the fact that the economy has been showing stability in the past several months, an indicator that has overshadowed the weakness present in the real estate industry.

Frank Nothaft, FRE VP and chief economist, has stated that, although the housing market has been looking somewhat crippled recently, the mortgage rates that apply to long-term loans have managed to remain all but unchanged due to the surprisingly positive information gathered regarding the general state of the economy, which indicates that there is still some staying power to the financial landscape.

Although the Labor Department has recorded information stating that thousands of jobs have been cut in the early months of 2008, the figures that were given fell very short of the estimated impact the economic downturn would have on the state of things in the country. In fact, as of recently, reports are showing that manufacturing and service jobs have been growing steadily, which suggests that the economy might be recovering in the near future.

Nothaft nonetheless points out that, despite the improvements that have arrived unexpectedly, the number of people that own homes has continued to decline at a constant pace. The vice president believes that the real estate market is still fighting to stay afloat amidst plummeting house prices, which are confounded by the harsher standards being imposed by loaners. These aspects, combined with a higher rate of foreclosures and payment delinquency, have managed to make the entire housing industry one that is struggling to survive.