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30 Yr Fix	6.26%	-0.11%
15 Yr Fix	5.78%	-0.13%
1 Yr ARM	5.10%	-0.07%
5/1 ARM	5.80%	-0.02%
30 Yr Tres	4.66%	0.02%
Fed Prime	5.00%	-0.25%
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Mortgage Rates Decline For Fourth Consecutive Week

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Both Freddie Mac and the Mortgage Bankers Association reported that all mortgages rates declined for the week ending April 28/29 although the decreases were very modest.

According to Freddie, the 30-year fixed rate dropped .02 percent to 5.78 and the 15-year averaged 5.33 percent compared to 5.36 percent the previous week. The 5/1 ARM was also down .02 percent to 5.20. The largest drop was in the one year ARM which declined .05 percent to 4.21. Rates in every category have now returned to the levels of early March 2005. Fees and points rose 0.1 to 0.6 for both fixed rate types and were down 0.1 to 0.5 for the 5/1 and unchanged at 0.6 for the 1-year ARM.

The Mortgage Bankers Association also reported across-the-board declines. 30-year and 15 year rates were 5.74 and 5.31 percent, down from 5.75 and 5.33 percent respectively. The one-year ARM declined .01 to 4.14 percent.

MBA reported that the Market Composite Index, their measure of mortgage loan application volume, increased 0.2 percent on a seasonally adjusted basis and 0.7 percent unadjusted from the previous week but was still 8 percent lower than at the same time in 2004.

Refinancing applications as a percentage of total mortgage loan activity declined very slightly from the previous week, to 39.1 percent and the ARM share of loan activity also decreased to 33.4 percent of total applications from 34.7 the previous week.

In other news, Freddie Mac reported that total refinancing activity declined during the first quarter of 2005 but the percentage of homeowners who chose to use their refinance to draw equity out of their homes jumped sharply.

During the last quarter of 2004, 56 percent of refinances resulted in mortgages that were at least 5 percent greater than the loans that were being refinanced. In Q1 of 2005 that number rose to 65 percent. This represents the highest percentage of cash-out refinancing since the fourth quarter of 2000. Total equity cashed out in the quarter was estimated at $46 billion, up from the revised cash-out estimate of $41 billion in the last quarter of 2004.

Freddie Mac's deputy chief economist Amy Crews Cutts estimated that there would be a total of $112 billion in cash drawn down from home equity by first lien refinances in 2005.

In the first quarter the median ration of old-to-new interest rates was 1.13, meaning that new mortgages carried a rate 13 percent lower than the mortgage that was refinanced.

Homeowners refinancing during this period saw a median house-price appreciation of 16 percent during the period they held the original loan. The median age of the loan being refinanced was 2.4 years.

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