Mortgage Mentor wishes to welcome Amber Nelson to the blogging family.  Look for a lot of good content to come from her in upcoming months.

The good news of the day is that 30 year mortgages once again dropped in the interest rate to the level of 6.40%, the lowest level it has seen in 6 weeks, and down again from last week.   Freddie Mac, the mortgage giant, put out this report, showing that levels are continuing to fall, even though being above 6% since last May.  The view of the financial markets is this – the pressure of rising inflation will keep the Fed from cutting rates because of the weakness in the marketplace. 

We are seeing the worst slump in the market than we have seen for many decades.  There is a glut of unsold homes on the market, and even though indicators show people are interested in buying right now, activity still remains far below the level of last summer.  Frank Nothaft, chief economist at Freddie Mac, said a good indicator is that the pace of home prices in decline has slowed somewhat in recent months.  I do not believe at this time that we have seen enough of a shakeout in home prices in hard hit areas yet to make a sizable difference.   There are still many over-valued homes in California, Florida and Nevada.  Even though this may be prime real estate, it doesn’t justify the unbelievable prices that are being asked.

The rest of the market shakes out like this:

·         15 year mortgages, the best vehicle for refi, are down at 5.93%, from 6%.

·         Five year, adjustable-rate mortgages averaged 6.03%, which are up from 5.99%

·         One year, adjustable-rate mortgages are up slightly to 5.33%, from 5.29%.

This is far from good, but shows improvement.  I am curious to see how the Presidential election shakes out, and what our new President will do.  It is obvious to me he will have his hands full.