Mortgage Rates Down Nearly 40 Basis Points From Year High
7324
Views - Printer Friendly - Email
This Story To A Friend
Once again Freddie Mac is reporting that mortgage rates are
down from the preceding week and have now reached levels not seen since late
March and early April.
The Primary Mortgage Market Survey for the week ended August 31 reported that
the 30-year fixed-rate mortgage averaged 6.44 percent with an average of 0.4
points compared to the average the previous week of 6.48 percent. This is the
lowest level for the 30-year since April 6 when the average was 6.43 percent.
The 15-year fixed-rate mortgage averaged 6.14 percent and 0.4 points, down
4 basis points from the week ended August 24. One year ago the 15-year averaged
5.32 percent but this weeks rate was the lowest level for the 15-year mortgage
since April 6 when it was 6.10 percent.
The 5/1 hybrid ARM was down to 6.11 percent from 6.14 the
week before. The 5/1 last saw this level during the week of March 30 when it
averaged 6.02 percent.
The traditional 1-year Treasury-indexed ARM averaged 5.59 percent with 0.7
points, down only a smidgen from 5.60 the previous week. The 1-year hit its
last most recent low during the week ended April 6 when it was 5.57 percent.
Fees and points for all products were unchanged this week from August 24.
Frank Nothaft, Freddie Mac vice president and chief economist said, "Mortgage
rates continued to drift lower this week in large part because of the cooling
in the housing market and in consumer confidence, thus giving financial markets
reason to believe that economic growth will moderate and inflation will remain
in check," As a matter of fact, the 30-year FRM (fixed rate mortgage) is
nearly 40 basis points lower than its peak of 6.8 percent in July of this year.
"By some indicators, personal incomes are growing faster than the cost
of housing. Combined with the still historically low mortgage rates, this will
help to support the housing industry as it levels off from the record highs
of the last few years."
The Mortgage Bankers Association (MBA) released its Weekly Mortgage Applications
Survey for the week ended September 1 on Wednesday and it also showed mortgage
rates moderating downward. In the case of the 30-year fixed rate mortgage,
the survey indicated that the average contract interest rate dropped to 6.31
percent from 6.39 percent with points, including the origination fee, increasing
from 1.03 to 1.10.
The 15-year fixed-rate mortgage dropped from 6.06 percent to 5.97 percent with
points increasing to 1.14 from 1.06 and the 1-year ARM decreased to 5.91 percent
from 5.97. In this case points also were down from 0.91 to 0.83.
All rates quoted are for 80 percent loan to value mortgages.
The Market Composite Index, a measure of mortgage application activity,
increased 1.8 percent on a seasonally adjusted basis from the week of August
25 and 0.4 percent unadjusted. Again the pace of applications lagged far behind
that of one year ago, down 26.1 percent from the same week in 2005.
Refinancing activity was down slightly. During the week ended September 1 it
represented 41.0 percent of all mortgage applications compared to 41.5 percent
the previous week. The market share of adjustable rate mortgages, at 26.2 percent,
reached the lowest level it has seen since October 2003;. One week ago ARMs
made up 26.8 percent of the market.
Related Tags
Select a Tag for more information related to that Tag. (View
All Tags)
mortgage rates |
