Mortgage Rates Remain Low After Fed Meeting

Mortgage rates fell for the third week in a row, and the rate on the most popular mortgage hit a record low, thanks to the Fed and the ongoing European debt crisis.

Rates have stayed near the bottom for this long partly because of the Fed’s economic stimulus, including its decision to continue to reinvest in mortgage-backed securities.

Rates have stayed near the bottom for this long partly because of the Fed’s economic stimulus, including its decision to continue to reinvest in mortgage-backed securities.

“There are still a lot of people out of work and a lot of foreclosures,” he says. “The government wants to keep the cost of money down. If rates were to go up, it would hurt the recovery.”

Also helping mortgage rates is the gloomy outlook for the debt crisis in Europe.After eurozone leaders signed off on a second bailout package for Greece, investors seemed to have gained some confidence in the region. But recently, investors have received clear signs Europe’s debt woes are far from over.

Uncertainty in the political and economic arena in Europe has renewed the fear among investors. While that’s not good news for the U.S. economy, it helps mortgage rates.

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