Fixed-rate mortgages set new record lows today on Freddie Mac weekly survey

Sandy Smith's picture

While signs that the two-month-long mortgage rate skid has lost its momentum persist, it has not yet come to a complete halt, as this week's Freddie Mac Primary Mortgage Market Survey indicates.

On the PMMS for the week ending Sept. 29, both 30- and 15-year fixed-rate mortgages set new record lows. The average rate for a 30-year fixed-rate mortgage slipped 2 basis points to 4.01% with an average 0.7 discount point, and the average rate for a 15-year fixed loan fell 1 point to 3.28% with an average 0.7 point. The average rate for a 5-year ARM held steady at 3.02% with an average 0.6 point.

Freddie Mac Vice President and Chief Economist Frank Nothaft attributed the performance of all the mortgage rates to last week's Federal Reserve announcement that it would shift its bond purchases to longer-term Treasury bonds and resume purchasing mortgage-backed securities in an effort to drive down long-term interest rates. "Fixed mortgage rates fell to all-time record lows this week following the Federal Reserve's announcement of its Maturity Extension Program and additional purchases of mortgage-backed securities. Interest rates for ARMs, however, were nearly unchanged as the Federal Reserve plans to sell $400 billion in short-term Treasury securities, which serve as benchmarks for many ARMs," he said.

Today's very low mortgage rates have produced a steady rush of refinancings as homeowners move to save on interest. Many borrowers have opted for even bigger savings by refinancing for a shorter term, causing 15-year mortgages to rise in popularity. Efforts to enable homeowners who owe more than their homes are worth to take advantage of today's low rates continue to be floated by policymakers, but no concrete plans have yet been implemented.

Today's mortgage rates continue trending up on overnight surveys

Freddie Mac data notwithstanding, mortgage rate movements on the major overnight surveys continue to point to a reversal of the downward trend, with significant week-to-week rises acrosss the board.

This morning's average mortgage rates on the Bankrate.com overnight survey, with changes from Tuesday and one week ago, are: 30-year fixed, 4.07% (-3 points, +7 points); 15-year fixed, 3.36% (unchanged, +6 points); 5-year ARM, 3.01% (-1 point, +8 points); 30-year fixed refinance loan, 4.18% (-2 points, +8 points).

Yesterday's average afternoon mortgage rates on the Zillow.com National Mortgage Marketplace, with changes from Wednesday and last week, are: 30-year fixed, 3.88% (-1 point, +4 points); 15-year fixed, 3.18% (unchanged, +10 points); 5-year ARM, 2.74% (+1 point, +19 points). Today's real-time rates as of 6 a.m., with changes from yesterday morning and afternoon, are: 30-year fixed, 3.82% (-3 points, -6 points); 15-year fixed, 3.17% (+1 point, -1 point); 5-year ARM, 2.73% (+1 point, -1 point).

One basis point equals one hundredth of a percentage point. Rates reported in this article assume good credit (FICO score of 650 or higher) and a 20% down payment. Morning rates from Zillow.com are for loans for the most creditworthy borrowers (FICO score of 720 or higher). One discount point represents one percent of the total value of a mortgage, paid as interest up front.

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