Mortgage rates are hitting near 50-year lows. Many industry experts are now saying that rates could go as low as 4.5% by summer. Refinances of existing mortgages is expected to increase, however, there are many who will be shut out of the market due to the housing declines throughout the country, where many people actually owe more on their homes than they are worth, making it impossible for those people to refinance.
Since the $8000 tax credit on home purchases is over, new mortgage loan applications have declined dramatically. According to the Mortgage Bankers Association the applications for new purchase loans hit a 13-year low in the week ending May 14, 2010. At this time it is unknown how the lower interest rates will affect new home sales and new mortgages.
The ?underwater? mortgages along with the strictest underwriting standards in over a decade has made it so many people cannot take advantage of these great rates, however, the lower interest rates could be a good start to a more healthy economy.
see Surprise Drop.
