While mortgage rates haven't kept pace with the plummeting Fed Funds Rate, the 30-Year Fixed rate has come down almost 75 basis points in recent weeks to a national average of around 5.7% yesterday. The recent trend got a boost last week from comments by Ben Bernanke that the Fed, which doesn't have much fire power left with its signature rate (how much lower than 1% can you go) may start trying to impact the long end of the curve by purchasing U.S. Treasurys. According to Bloomberg, refinancing can already make sense for home owners with existing mortgages of 5.5% or higher. Presumably a wave of refinancings would help both the real estate market and the overall economy, generating fees for banks a lowering carrying costs for owners. Have any readers been looking into refinancing? Excuse us while we go have a look at the fine print on our mortgage now.
Long Bond Returns Most Since 1995 [Bloomberg]
30-year Fixed Mortgage Rates Down Tuesday [Bankrate]
Graph from Seeking Alpha
