Mortgage rates’ new low draws new buyers

  • Article by: JIM BUCHTA , Star Tribune
  • Updated: May 18, 2012 - 9:18 PM

The declines also are boosting optimism among lenders, agents.

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allhailfsmMay. 19, 12 8:17 AM

"This week, the average fixed-rate for a 30-year mortgage fell to 3.79 percent"

This shows just how selfish and destructive republicans are. They are fighting to RAISE the student loan rate from 3.4 to 6.8 percent! They say that the 3.4 percent rate is losing money, yet the private mortgage market is willing to loan homebuyers money for 30 years at 3.79% !!!

If the private market can make money at 3.79%, then the government is certainly making money at 3.4%

Republicans are simply trying to destroy direct student loans so their freinds the banksters can profit from it.

Truly shameful. They are willing to sell out our future knowledge and productivity of our youth for a short term profit and hoped for political advantage.

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SpAgent74May. 19, 12 9:44 AM

Well, it isn't that simple, you see those loans are in portfolios, and people have those in their investments. So they aren't getting the return they thought, so they want the % rate higher obviously. Secondly, the banks are getting the money for free right now, so they are MORE THAN HAPPY to get 4% on their loans. very few people are actually getting 3.79%. If you can get that % rate, you already own a home! :)

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twinman55May. 19, 1210:29 AM

This shows just how selfish and destructive republicans are. They are fighting to RAISE the student loan rate from 3.4 to 6.8 percent!....OR it shows how unlightened they are...with a default rate of around 10%, even the higher interest rate doesn't cover the cost of the student loan program. One of the reasons the mortgage interest rate is so low is because the default rate is typcially low and they are secured by the property.

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fromupnortMay. 19, 1212:12 PM

Yes, run out there and buy a house with cheap interest...never mind that its really just a rental program with the landlord/lender making sure you pay all the house's maintenance fees. It must be good for you because your Uncle allows a "tax" deduction on your rental, er...mortgage interest. Buy now because tomorrow might be too late!

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allhailfsmMay. 19, 1212:26 PM

The default rate for people graduating with a 4 year degree from a public school was 5.2%. Four-year grads of traditional private schools had a default rate of 4.6%.

The big default rates come from students who attended proprietary for-profit schools. The default rate for students who got a four year degree was 15.6%, three times the rate of traditional ( not for profit ) public and private schools.

We all want to use save taxpayer money wisely, so I suggest the better way would be to stop allowing students to borrow money to attend schools whose grads cannot get jobs, and cannot pay their loans.

Obama has tried to do that, but the Repubs won't allow it because it is "anti-business".

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dedo112May. 19, 12 2:11 PM

allhailfsm The private mortgage market is not willing to keep the loans on their books for 30 years at rates below 4%. That is why almost all of these home loans are sold to Fannie and Freddie almost immediately. All the risk has been transferred to the taxpayer since Fannie and Freddie are owned by the govt. The banks are just collecting the fees and selling the loans. How many billions has Fannie and Freddie collected from the US taxpayer? The govt student loans could be the next ticking timebomb? Are you willing to take that risk with taxpayer money?

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parn0015May. 19, 12 2:48 PM

I feel like I have been reading a new article every month for years now with real estate agents claiming NOW is the best time to buy a house. The trend of foreclosures and defaults just continues though, and overall home prices have been dropping for half a decade. It still hasn't bottomed out, but they keep trying to throw a positive spin on it.

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carbonbigfutMay. 19, 12 5:28 PM

allhailfsm: "We all want to use save taxpayer money wisely, so I suggest the better way would be to stop allowing students to borrow money to attend schools whose grads cannot get jobs, and cannot pay their loans." Or, turn the student loan program back to the banks, so they can make the decisions on which borrowers are most likely to pay back their loans.

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pitythefoolsMay. 20, 1210:14 AM

carbonbigfut: "Or, turn the student loan program back to the banks, so they can make the decisions on which borrowers are most likely to pay back their loans."

Yeah. They did so well with mortgages...

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