Mortgage Brokersâ€™ phones rang off the hook last week as 30-year mortgage rates dropped below 6 percent. Some brokers say their rates are as low as 5.25 percent.
The rates are down because the Federal Reserve announced that it would buy $500 billion in mortgage-backed securities held by Fannie Mae and Freddie Mac. That would help the two increase the pool of money for new mortgages.
“This is really craziness,” says Brian Koss, a managing director of Mortgage Network.
Koss advises borrowers who find an attractive rate to lock it in for 60 days. â€œDrop everything you are doing, get the mortgage professional all of the paperwork they need, so you don’t run out of time,” he says.
Source: USA Today, Anna Bahney