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Interest Rates Update

April 13th, 2017 · No Comments · California Real Estate, Mortgage Information, Santa Barbara Real Estate

Painting by Chris Potter Santa Barbara Artist Extraordinaire

Continued strength in the labor market could lead the Federal Reserve to continue gradually raising interest rates. Mortgage rates, however, have declined for three straight weeks following the Fed’s early March announcement that it would raise rates; 30-year, fixed-rate mortgages currently stand at 4.10 percent, according to Freddie Mac. Falling mortgage rates could reflect markets’ adjusting to the workings of the new administration and the realization that changes, if enacted, will take longer than expected. In fact, it has become increasingly harder to predict how President Trump’s policies will change and what the impact on the economy will be.

The effort to overhaul health insurance met resistance from both parties, as did proposed immigration and travel policies. Though many observers expect tax reform to be next on the agenda, the government is now facing debate over the debt ceiling and spending, which will slow any progress on tax-reform talks.

As of April 13, 2017 the average rate on a 30 year fixed rate mortgage dropped two basis points to 4.08% (0.5 points). The average rate on a 15 year fixed rate mortgage sunk two basis points to 3.34% (0.5 points). The average rate on a 5 year adjustable rate mortgage fell one basis point to 3.18% (0.4 points). 

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