June 18th, 2009 by Michael Oliver

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Mortgage Rates have started falling pretty significantly almost a full quarter of a point (0.21% to be exact) making the current 30 year fixed mortgage rate on average 5.38%. Rates were topping out around 5.75% just a couple of weeks ago as the stock market had seen serious gains pulling money out of bonds depressing their yields thus essentially lowering mortgage rates. (There are a couple more steps involved but that’s the simple way to make it understandable in how and why mortgage rates raise and fall.)

On the whole these current mortgage rates are very, very low, which is a good sign for the Tucson real estate market. Anytime rates are under 6% historically is cheap and anytime the 30 year rates are under 5.5% even more so. Mortgage rates had been as low as 4.78% on April 2nd those buyers in the market that are waiting for the sub 5% 30 year mortgage rates to come back anytime soon I think will be disappointed. However the Fed will keep rates low for the rest of 2009 just don’t count on sub 5% here is an except from cnbc.com taking about the intentions of the Fed in regards to mortgage rates:

“Make no mistake, these rates are low and they’re going to stay low,” he said. “The Fed still has approximately $1 trillion in its buyback program to put to work for the balance of 2009. That will continue to keep a lid on mortgage rates.”

The government has embarked on an aggressive program to keep mortgage rates lower. It has set a goal to buy up to $1.25 trillion of mortgage-backed securities as well as $300 billion in Treasurys and $200 billion of agency debt such as those loans backed up by Fannie Mae and Freddie Mac.

Current Mortgage Rates In Tucson Arizona:

• 30 Year Fixed Conventional: 5.375%
• 15 Year Fixed Conventional: 4.875%
• 30 Year Fixed FHA: 5.50%
• Jumbo (over $417,000) 30 Year Fixed: 5.75%

Rates provided by Eric Painter at Nova Home Loans