There's no doubt that current news trends are affecting all markets and the direction in which they are moving. This is true for mortgage rates as well. Freerateupdate.com's daily survey of wholesale and direct lenders show that low mortgage rates are holding on to the current lows despite the mixed headlines regarding economic conditions both here and abroad.

Conforming 30 year fixed mortgage rates are currently at 4.250% and 15 year fixed mortgage rates are at 3.500%. 5/1 adjustable mortgage rates are at 2.750%, still well before 3%. With good credit, these are the lowest mortgage rates available with 0.7 to 1% origination fee. These low mortgage rates have been steady for several weeks and are having a positive impact on mortgage business. According to The Mortgage Bankers Association, mortgage applications increased by 13% for the week ending June 10th which is the best improvement since early March.

FHA mortgage rates have also remained low which is always favorable news for borrowers. FHA 30 year fixed mortgage rates are at 4.250%, FHA 15 year fixed mortgage rates are at 3.750% and FHA 5/1 adjustable mortgage rates are at 3.000%. FHA mortgage loans are especially good for first time home buyers because of the low down payment requirements.

FHA also allows gifts and the use of housing grants. Easier credit qualifying for FHA mortgage loans makes up for the fact that FHA closing costs (APR) are higher due to various FHA fees and the upfront mortgage insurance premium.

Jumbo mortgage rates have done just as well at remaining low and steady. Current jumbo 30 year fixed mortgage rates are at 5.000%, jumbo 15 year fixed mortgage rates are at 4.500% and 5/1 adjustable mortgage rates are at 3.625%. With excellent credit, high end borrowers can obtain these low jumbo mortgage rates with 0.7 to 1% origination point. Jumbo mortgage loans are necessary for mortgage amounts above the conforming loan limit which is $417,000 to $729,750 depending on the area. The current conforming loan limit is scheduled to decrease in the fall of this year.

MBS prices (mortgage backed securities) have been on a roller coaster ride this past week. Mortgage rates move in the opposite direction of MBS prices. The Consumer Price Index increased in May and, at the same time, the Department of Labor reported a decrease in initial jobless claims for the week ending June 10th as well as a drop in the unemployment rate. According to the U.S. Census Bureau and HUD, building permits and housing starts both increased during the month of May. The price of crude has fallen bringing a sudden drop in gasoline prices, both good news for consumers. Uneasiness in European countries has continued to create some volatility in U.S. markets.

FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders’ rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1% point origination fee.

Click here for Freerateupdate's California Mortgage Rates.

Published: June 22, 2011

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Edward James Ferrara III spent 8 years (2001-2008) brokering and banking home loans in Orange County, CA to the tune of some 500 million dollars in mortgages funded by May of 2008, when he founded the rate research website FreeRateUpdate.com. Ed is not only the founder of FreeRateUpdate.com, he is also a lead contributor to the site, whose roster includes over a dozen writers and of which receives over 50,000 page views per month. Ed's passion for helping consumers to avoid falling victim to banks dishing out higher rates for bigger profits has helped FreeRateUpdate.com to become a unique authority on mortgage rates. Ed recently married Cheyne Aki Gantt and became a first time father to Edward James Ferrara IV, born August 31st 2009. Ed and FreeRateUpdate.com have recently been cited in numerous media outlets including the Los Angeles Times, Yahoo Finance, and Marketwatch.