Home builders have used all sorts of gimmicks to try and get people to buy homes in the declining real estate market. But now, Toll Brothers is taking incentives to a whole new level by offering fixed-mortgage rates at just below 4 percent--that's substantially lower than the already-compelling average rates of roughly 5 percent.
From The Wall Street Journal:
Horsham, Penn.-based Toll this week started offering a 3.99% fixed mortgage rate for loans $417,000 or below for 30 years with no points, one of - if not the - industry's lowest rates, one well below the national average of just below 5%.
It's too early to say if other builders will copy the attention-grabbing rate, but as the market worsens, competition is fierce and this move could launch a scramble to match the rate.
"It's definitely something that if they haven't considered it already, they will," said Brent Anderson, vice president of investor relations for Meritage Homes Corp. (MTH), which doesn't have a mortgage subsidiary.
[For more on the interest rate trends, check out: Mortgage Rates Drop Below 5 Percent: 4 Things to Know.]