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It seems that everybody is looking through those rose-colored glasses we were talking about yesterday.  The S&P closed at another all-time high of 1911, and MBS crept to a new 12 month high as well.  Today Stocks are down marginally while Bonds opened up, driving yields (interest rates) down further.  I tend to be conservative with other people’s money and recommend locking in these great rates as soon as you get a chance, hence yesterday’s caution.  But what the heck, you only live once; today I say let it ride and let’s get those 30 year rates back in the 3’s!
We just crossed a pretty strong threshold, and banks are lowering interest rates because all they can see are blue skies from here.  Thirty year FHA loans are still at 3.5% and Conventional loans are a bit higher at 4.0%. Fifteen year rates are down at 3.125% (APR will be higher, depending on the loan and down payment amounts, and amortization term–as closing costs and the presence of mortgage insurance affect each loan differently.)