Mortgage rates dip, but cash is still king
The drop in mortgage rates during the past week is bringing out fresh buyers to a tired real estate market, but only a few of them are scoring.
Rates hovering at 5.38 percent are drawing some fence-sitters with good credit who figure rates are not likely to decline much further.
The drop precipitated by the government’s $800 billion attempt to thaw the credit and housing markets also has lured people interested in refinancing.
The trouble there, brokers say, is that those who need a refinancing the most cannot get it, because they do not have enough equity. In worst shape are those operating “underwater,” or with so-called “negative equity,” meaning the precipitous drop in home prices in the last two years has brought their values below their loan amount.