September 19, 2008
The average rate for the 30-Year Fixed Rate Mortgage fell this week
for the fifth week in a row.
According to mortgage giant Freddie Mac's Primary Mortgage Market, the loan averaged 5.78 percent with an average 0.6 point compared with last week's 5.93 percent. The last time it was lower was the week ending February 14, 2008. Last year at this time, the 30-year FRM averaged 6.34 percent.
The rate for 15-year FRM, often used for refinancing mortgages fell to 5.35 percent with an average 0.6 point, from 5.54 percent last week. The 15-year FRM hasn't been lower since the week ending March 27, 2008, when it averaged 5.34 percent
A year ago the average was 5.98 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages, or ARMs, averaged 5.67 percent this week, with an average 0.7 point, -- a drop of 20 basis points. A year ago, the 5-year ARM averaged 6.21 percent.
The average rate for 1-year Treasury-indexed ARMs was 5.03 percent this week with an average 0.5 point, versus last week's 5.21 percent. It averaged 5.65 percent a year ago.
"Interest rates for 30-year fixed-rate mortgages fell for the 5th consecutive week, amounting to a total decline of about 0.75 percentage points," said Frank Nothaft, Freddie Mac vice president and chief economist. "As a result, mortgage applications surged nearly 58 percent since August 15th, largely led by a 122 percent gain in applications for refinancing, according to the Mortgage Bankers Association".
The MBA also reports that fixed-rate mortgages are currently the predominant choice among homebuyers and families looking to refinance.
Over the first two weeks of September, 95 percent of new applications were for fixed-rate mortgages. Since the end of 2007, the number of ARM applications is down by almost 50 percent.
