So far, the cuts in fees apply mainly to one type of reverse mortgage: the plain-vanilla fixed-rate "home-equity conversion mortgage, " which is backed by the Federal Housing Administration and is paid out to the borrower as a lump sum.
Going back 20 years, the trendline rate for a home mortgage prints out near 7 percent, currently under 4 percent.
If you expect to live in the home for less than 10 years, an adjustable rate mortgage could make sense.
Fidelity National is certainly sensitive to activity in the residential mortgage market, and as rates on mortgages have come back down from April through mid-May, interest rate sensitive stocks such as the home builders, mortgage lenders and REITs have all rallied.
Home prices there have been plunging for years, and the mortgage delinquency rate is currently in double digits.
Conversely, a fixed rate mortgage could be appropriate if you planned to keep home for a significant period of time.
Li Peixuan, who was at a property showroom in Shanghai's Minhang district with her boyfriend purchasing their first home, said she was attracted by the 15% discount, which would push the mortgage rate down to around 6.8%.
We use the 2003-2004 home ownership rates because those were the years of the lowest previous mortgage rates (the average mortgage rate was 5.8%).
Interest rates should remain low for the medium term, but the specter of an interest rate rise may also nudge those on the fence to lock in that mortgage and buy a home.
So the idea is that if you have one of these loans, you live in the home, you're still current on the mortgage, you'll be able to keep the current interest rate, and hopefully, in a couple of three years, when the housing market settles and more credit is flowing into the housing market, you'll be able to refinance into another mortgage and stay in the home.
In Houston, where unemployment is low and home prices are healthy, the average borrower pays 5.03% on a mortgage--the fifth-lowest rate on our list.
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