The average rate on a 30-year fixed-rate mortgage was unchanged, the 15-year fixed-rate fell one basis point and the 5/1 ARM was unchanged, according to a NerdWallet survey of daily mortgage rates published by national lenders Thursday.
The 30-year fixed-rate mortgage is six basis points lower than one week ago, and 27 basis points lower than one year ago. A basis point is one one-hundredth of one percent.
Mortgage rates have improved compared with a year ago, and so has the story on home equity. When you owe more on your house than the house is worth, bankers say you have negative equity. (Normal people, like us, tend to say you’re “upside-down” or “underwater” on your home.) Having negative equity carries a risk of foreclosure. Here’s why: If you fall behind on the mortgage payments, you can’t simply sell the house to pay off the loan.
From the third quarter of 2016 to the third quarter of this year, 712,000 homeowners went from having negative equity to having positive equity, according to a quarterly study from CoreLogic. The real estate data company says 4.9% of mortgaged homes have negative equity — down from a 26% negative-equity rate in the depths of the Great Recession, in the fourth quarter of 2009.
The major metro area with the greatest concentration of homes with negative equity is Miami, describing almost 14% of homes. Fewer than 1% of homes in San Francisco have negative equity.
MORTGAGE RATES TODAY, THURSDAY, DEC. 7:
NerdWallet daily mortgage rates are an average of the published annual percentage rate with the lowest points for each loan term offered by a sampling of major national lenders. APR quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.