Thursday, May 20, 2021.
The Paycheck Protection Program, which was the initiative of the U.S government, had a $788 billion relief effort for small businesses ravaged by the coronavirus pandemic. It has now ended with the initiative’s final days mired in chaos and confusion.
Millions of applicants are vying for funds from the few lenders who continue to make government-backed loans. In addition, hundreds of thousands of people are awaiting word on the approval of their loans and are expecting it to get funds soon. However, lenders are overburdened, and borrowers are terrified.
The relief program was supposed to accept applications until May 31. However, its manager, the Small Business Administration, announced two weeks ago that the program’s $292 billion in forgivable loan financing for this year had nearly run out and that it would immediately stop processing most new applications.
Mortgage Rates for 30-Year Mortgages Have Risen.
Because it provides a consistent and relatively low monthly payment, a 30-year fixed mortgage is by far the most common type of mortgage.
Fixed for 30 years: The average rate increased to 3.26%, up from 3.25% the day before. It was 3.28% a week ago. So monthly payments for a $100,000 loan would be around $435.76, about $1 less than a week ago.
30-year fixed-rate mortgage (FHA): The average rate increased to 3.14 percent, up from 3.08 percent the day before. It was 3.14% a week ago. Monthly payments for a $100,000 loan would be approximately $429.19, the same as a week ago.
30-year fixed (VA): The average rate increased to 3.14 percent, up from 3.1 percent the day before. It was 3.18% a week ago. So monthly payments for a $100,000 loan will be around $429.19, which is about $2.18 less than a week ago.
The 15-Year Fixed Mortgage Has Risen.
The average rate of the mortgage for a 15-year fixed is approximately 2.37 percent, up 2 basis points from the previous week.
At that rate, monthly payments on a 15-year fixed mortgage will be $661 per $100,000 borrowed. That may put a strain on your monthly budget more than a 30-year mortgage, but it has some significant advantages: you will save thousands of dollars in total interest paid over the life of the loan and build equity much faster.
Jumbo Mortgage Rate Rises
Jumbo loans, which allow you to borrow more money for more expensive properties, have slightly higher interest rates than standard loans.
Fixed 30-year jumbo: The average rate increased to 3.55 percent, up from 3.54 percent the day before. It was 3.53% a week ago. Thus, monthly payments for a $100,000 loan would be $451.84 or about $1.12 more than a week ago.
Fixed-rate 15-year jumbo mortgage: The average rate remained at 3.16 percent, unchanged from the previous business day. It was 3.15% a week ago. Monthly payments for a $100,000 loan would be approximately $698.30.
Refinance Rates Today
In a low-interest environment, refinancing an existing mortgage is slightly more expensive than getting a new one.
30 year fixed: The average refinance rate increased to 3.55 percent from 3.54 percent the previous business day.
15-year fixed: The average refinance rate increased to 2.66 percent from 2.65 percent the day before.
According to Freddie Mac researchers, mortgage rates are expected to rise slightly throughout 2021, citing the Federal Reserve’s commitment to keeping interest rates low for the near future.
According to Fannie Mae researchers, mortgage rates will trend slightly higher this year, owing to the ongoing rise in the 10-year Treasury yield. However, Fannie Mae experts believe that lenders will “absorb” some of the increased costs as “refinance demand gradually wanes,” keeping rates relatively stable.