NPR logo Record Low Mortgage Rates Tease Consumers


Record Low Mortgage Rates Tease Consumers


The good news is that mortgage rates are at historic lows.

The bad news is that millions of people can't benefit from that good news because they're unemployed, underwater on their mortgages, have too much debt or have slipping credit scores.

But for people with near perfect credit, life-time employment and strong home values, times have never been better. In other words, maybe a few federal judges can qualify.

An excerpt from

The benchmark 30-year fixed-rate mortgage fell 7 basis points this week, to 4.81 percent, according to the national survey of large lenders. A basis point is one-hundredth of 1 percentage point.

That 4.81 percent is a record low in the nearly 25-year history of Bankrate's weekly survey. For the previous two weeks, the benchmark 30-year rate had stood at 4.88 percent, and that had been the record low.

According to records kept by the National Bureau of Economic Research, rates of FHA-insured mortgages averaged 4.81 percent in June and July, 1956, and 4.78 percent that May. That seems to be the last time rates were lower than now.

In normal times, these kinds of rates would have people stampeding for their friendly neighborhood bank or mortgage broker.

But, again, those days are over. These super low rates are the newest version of teaser rates.

In the housing bubble days, teaser rates suckered people into mortgage loans that eventually reset at much higher rates.

These latest teaser rates just tease all those who can only dream of getting one of them.