Despite the recent drop in the unemployment rate to 5.9%, it is unlikely the Federal Reserve will make a change to their monetary policy. The Fed has stated that it expects to keep short term rates at current levels going into 2015 and many believe they will not deviate for the following reasons:
1. The jobs report and unemployment rate are subject to many revisions
2. Hourly income remains flat which means wages aren’t growing. It’s hard for the economy to improve faster without meaningful wage growth.
3. The labor force participation rates is at a 30 year low with too many working age Americans not looking for employment.
4. Many Americans are under employed with either low paying jobs or part time employment.
The bottom line is that home loan rates remain near some of their best levels this year and it’s a great time to consider making a home purchase
Rates closed on 10/3/14 as follows:
30 YR: 4.125% to 4.25% (APR: 4.2% to 4.4%)
15 YR: 3.25% to 3.375% (APR 3.3% to 3.4%)
7 ARM: 3.375% to 3.625% (APR: 3.5% to 3.7%)
3.625% to 3.75% (APR: 5.4% to 5.6%)
30 YR Jumbo:
4.00% (APR 4.1%)