Current Mortgage Rates

Friday, November 20, 2009



Collateral is property that you pledge as a guarantee that you will repay a debt. If you don't repay the debt, the lender can take your collateral and sell it to get its money back. With a home equity loan or line of credit, you pledge your home as collateral. You can lose the home and be forced to move out if you don't repay the debt. For collateral security, lenders care about two things:
  • the amount of the down payment
  • the professional appraisal of the property value
If you can't make the loan payments and the lender has to foreclose on the house, they want to make sure that the total of these two amounts (how much money you put down and how much the home is worth) will cover the cost of the loan. The most adventurous buyers might be interested in financing their purchases with little-known vehicles called pledged-asset mortgages. These loans allow consumers to use their investment portfolios as collateral for mortgages -- rather than gather together a traditional down payment -- while still qualifying for the most competitive mortgage rates.

The benefit: Rather than tie up money in real estate, they can remain invested elsewhere. Pledged-asset mortgages obviously aren't for the timid. If the stock market falls and you don't have the cash to satisfy a collateral call, you could be forced to sell the securities in your pledge account as well as other investments to raise the value of your account, warns John Gannon, vice president of investor education of NASD.

Be warned: In a volatile stock market, the brokerage firm could sell your securities to meet the collateral call without contacting you. Moreover, you aren't entitled to choose which securities in your account are sold to meet the call, says Gannon. And here's a truly bleak scenario: Should you default on your mortgage for any reason, you could lose your house and your securities.



Get Current Mortgage Rates
From Top Lenders

Property State
Type of Loan
Home Description
Your Credit Profile
Note: Your credit profile will not be run for this inquiry.

Mortgage Resources



Current Mortgage Rates*

Loan Type
National Average
30-yr. fixed4.75%
30-yr. fixed jumbo5.25%
15-yr. fixed4.25%
15-yr. fixed jumbo4.75%
7/1 ARM4.38%
5/1 ARM4.00%
3/1 ARM4.00%
1-yr. ARM3.62%
1-yr. LIBOR ARM4.38%
10/1 ARM4.62%
*Mortgage Rates Updated: 11/20/2009