Mortgage interest rates today, December 9, 2023

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Mortgage rates have been falling steadily, and fell further this week. So far in December, 30-year mortgage interest rates have remained steady at less than 7%.

The Bureau of Labor Statistics on Friday released its November jobs report, which showed the labor market is strong but continuing to return to normal.

This is good news for mortgage rates, because it means the Fed is likely to keep the federal funds rate steady at its meeting next week. Markets even think we may see some Fed rate cuts next year, which would likely lead to lower mortgage interest rates in 2024.

However, the effects of the Fed’s interest rate hikes over the past two years are still present, and inflation remains somewhat elevated. As long as inflation and the labor market continue to slow, mortgage rates should as well. But Fed officials said they are willing to raise interest rates further if necessary, which could push mortgage interest rates higher again.

“The recent rapid decline in interest rates – in particular, the mortgage rate has fallen by nearly 80 basis points since the end of October – coupled with continued job growth is beneficial for homebuyers; however, if labor markets remain this strong, we believe “The decline in mortgage interest rates is unlikely to persist in the near term or may partially reverse,” Mark Ballem, deputy chief economist at Fannie Mae, said in an email.

Mortgage rates today

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Today’s Mortgage Refinancing Rates

Mortgage calculator

Use our free mortgage calculator to see how today’s mortgage rates will affect your monthly and long-term payments.

Mortgage calculator

$1,161
Estimated monthly payment

  • Pay a 25% A higher down payment will save you money $8,916.08 on interest charges
  • Reduce the interest rate by 1% It will save you $51,562.03
  • Pay an additional amount 500 dollars Each month would reduce the loan term by an amount 146 Months

By plugging in different time periods and interest rates, you’ll see how your monthly payment could change.

Mortgage rate forecasts for 2023

Mortgage rates began rising from historic lows in the second half of 2021 and increased by more than three percentage points in 2022.

Interest rates have risen further this year, although they may fall soon as inflation continues to slow. In the past 12 months, the CPI has risen 3.2%, a significant slowdown from when it peaked last year at 9.1% in June.

For homeowners looking to leverage the value of their home to cover a large purchase — such as a home renovation — a home equity line of credit (HELOC) may be a good option while we wait for mortgage rates to decline. Check out some of the best HELOC lenders to start your search for the right loan for you.

A HELOC is a line of credit that allows you to borrow against the equity in your home. It works similarly to a credit card in that you can borrow what you need rather than getting the full amount you borrow in a lump sum. It also allows you to tap into the money you have in your home without replacing your entire mortgage, as you would with a cash-out refinance.

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Current HELOC rates are relatively low compared to other loan options, including credit cards and personal loans.

When will house prices fall?

Home prices fell slightly month-on-month late last year, but we’re unlikely to see significant declines anytime soon thanks to very limited supply.

Fannie Mae researchers It is expected that prices will rise by 6.7% in 2023 and 2.8% in 2024, while Mortgage Bankers Association It expects an increase of 5.7% in 2023 and an increase of 4.1% in 2024.

High mortgage rates have pushed many hopeful buyers out of the market, slowing home purchase demand and putting downward pressure on home prices. But interest rates may start to fall next year, which would remove some of these pressures. The current supply of homes is also Historically lowThis would prevent prices from falling.

Fixed interest rate vs. adjustable interest rate mortgage pros and cons

Fixed-rate mortgages lock in your interest rate for the life of your loan. An adjustable-rate mortgage locks in your rate for the first few years, then your interest rate rises or falls periodically.

So how do you choose between a fixed-rate mortgage versus an adjustable-rate mortgage?

ARMs typically start out with lower rates than fixed-rate mortgages, but ARM rates can rise once the initial introductory period ends. If you plan to move or refinance before the rate adjusts, an ARM may be a good deal. But keep in mind that any change in circumstances may prevent you from doing these things, so it’s a good idea to consider whether your budget can handle a higher monthly payment.

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A fixed-rate mortgage is a good option for borrowers who want stability, since your monthly principal and interest payments will not change throughout the life of the loan (although your mortgage payment could increase if taxes or insurance rise).

But in exchange for this stability, you will get a higher price. This may seem like a bad deal right now, but if interest rates rise further in a few years, you may be happy to lock in your interest rate. If interest rates trend lower, you may be able to refinance to get a lower interest rate.

How does an adjustable rate mortgage work?

Adjustable-rate mortgages start with an introductory period where your interest rate remains fixed for a certain period of time. Once this period is up, it will begin to be modified periodically – usually once a year or once every six months.

How much your rate will change depends on the index the ARM uses and the margin set by your lender. Lenders choose which index their asset management tools use, and this rate can trend up or down depending on current market conditions.

The margin is the amount of interest charged by the lender on top of the index. You should shop around with several lenders to see which one offers the lowest margin.

ARMs also come with limits on how much you can change and how high you can go. For example, an ARM may be limited to an increase or decrease of 2% each time it is adjusted, up to a maximum of 8%.

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