Here’s Why Interest Rates Will Go Up on April 1

Here’s why interest rates will go up on April 1st for San Jose home buyers. It’s anticipated that rates will be higher then from where they are right now. That’s the day that all banks will implement their new pricing guidelines, and of course whenever new rules come into affect, they usually affect you the borrower. You can be sure that banks are going to hedge their new pricing module in the form of higher interest rates. Right now the 30 year fixed conforming rates are still under 5%. If you would like me to take a look at your current loan, or if you have a friend, family member or neighbor who you think should talk to me, please do so as soon as you can. It could be the last opportunity to lock in a rate under 5%.

FHA has long been offering loans with only 3.5% down payment, credit scores as low as 580, and even allowing a non occupying co-borrower on your home purchase with the lowest rates you could find. Starting April 18th you should be ready to pay more for an FHA loan. That’s the day they will raise their annual mortgage insurance by .25, which on a 350k loan translates to an extra $75 per month. Now the good news is that if you get an FHA case number before that date, you’re grandfathered in, and you can bask in the warm glow of a lower payment. And for you Realtors with listed homes that might be bought using an FHA loan, since the case number sticks with that home, even if the potential buyer doesn’t close, you’ll be able to save the next person money if you get your case number before April 18th.

Rich Iacovetta is the founder and president of RMI Lending in Santa Clara, CA.  For more information, or to schedule an appointment, contact Rich at 408-249-1919 or toll free at 888-899-4537.  You can also drop him an email at: rich@RMILending.com.