As the price of oil continues to slide and the economies on both sides of the pond struggle, the 30 year VA mortgage rate hit their lowest of the year. The 15 year fixed VA rate today is hovering around 2.75% today. That’s right, 2.75%. And that’s without paying any discount points, too. We’re in a rather enviable position right now, at least compared to other economies. Much of Russia’s economy is dependent upon the extraction and sale of crude oil and their economy was doing okay when the price of oil was above $100 but as it falls below $60 per barrel, it hits them where it hurts the hardest. That’s cool and all but a faltering Russian economy might also affect its surrounding neighbors.
There just isn’t any other economy other than ours that is providing investors with solid returns in equities while seeing a heavy influx of capital in securities. Our stock market seems to be holding up rather well while demand for mortgage bonds and U.S. Treasuries is still strong, despite the Fed’s exit from their quantitative easing program last October. All that said, we can expect to see VA mortgage rates at least hold their own and perhaps drop a few more basis points.
The November unemployment report was relatively impressive, creating more than 300,000 jobs. If December’s numbers come in at a similar fashion, mortgage rates just might start to rise. The December report will be released January 9th. Until then however, mortgage rates are still very, very attractive.