Mortgage rates are low, are they headed even lower
According to Bankrate, mortgage rates are averaging 5.5% for a 30 year fixed rate loan. I have actually heard of even lower rates available from very reliable lenders at both 5.0% and 5.25%.
When the Federal Reserve announced that it would buy $500 Billion in mortgage backed securities last week guaranteed by Fannie and Freddie, rates dropped almost immediately and there was a rush by many current homeowners into refinancing.
The Treasury is now considering a plan to encourage home buying by offering rates as low as 4.5% in order to stimulate the housing market. That rate apparently would not be available for refinancing but only for home purchases.
Of course, the Charleston real estate market could use a little boost in demand and low interest rates would do exactly that. One reason that demand would increase is that housing becomes even more affordable with a lower interest rate and more people would be able to qualify for a loan.
But don't confuse any of this with the loans that were offered just a few years ago. These are 30 year fixed rate loans and they are not teaser rates. A down payment is pretty much required (no, we're not back to the old 20% down) and you can also expect stricter underwriting standards that require income and debt to be documented.