Mortgage Rates dipped back below 5 percent this week, according to Freddie Mac, and they should head sharply lower from here. That's because the data Freddie used in its survey was collected before the Fed unveiled its plans yesterday to purchase more than $1 trillion in assets--a move that should pull rates downward significantly.
Nigel Gault, chief U.S. economist for IHS Global Insight, told me yesterday that the Fed's actions could drag 30-year fixed mortgage rates as low as 4.5 percent.
From The Associated Press:
Rates on 30-year mortgages plunged this week to the lowest level since January, and are poised to fall further after the Federal Reserve launched a new effort to prop up the flailing housing market.
Mortgage finance giant Freddie Mac said Thursday that average rates on 30-year fixed-rate mortgages dropped to 4.98 percent this week. That was down from 5.03 percent last week.
It was the lowest since the week of Jan. 15, when it was at 4.96 percent.