Mortgage Interest Rates Remain at Record Lows, May Go Lower

September 22, 2011 (Shirley Allen)

Continued economic concern kept mortgage interest rates at record lows according to Freddie Mac’s Primary Mortgage Market Survey® (PMMS), but the Fed’s new economic action could lead to even lower rates.

Troubling economic news in Europe and at home kept rates near last week’s record lows with the 15 year fixed rate mortgage again setting a new low and the Federal Reserve announced a new economic plan which basically swaps short term debt for long term debt that is expected to keep interest rates low over the next year.

Fixed Rate Mortgages (FRM):

The 30 year FRM remained unchanged from least week’s record low averaging 4.09 percent, with an average of 0.7 points. The 30 year FRM averaged 4.37 percent a year earlier.

The 15 year FRM set a new low averaging 3.29 percent this week with an average 0.6 points, down from 3.30 percent reported the previous week, and down from 3.82 percent a year ago.

Adjustable Rate Mortgages (ARM):

ARM interest rates increased slightly this week with the 5-year Treasury-indexed hybrid ARM averaging 3.02 percent, up from 2.99 percent last week, with an average of 0.6 points. The 5 year ARM averaged 3.54 percent a year earlier.

The 1-year Treasury-indexed ARM increased one basis point, averaging 2.82 percent this week with an average of 0.6 points, up from 2.81 percent the previous week. A year ago, the 1 year ARM averaged 3.46 percent.

Frank Nothaft, vice president and chief economist of Freddie Mac, stated, “A sluggish economy and investor concerns over the European debt markets left mortgage rates largely unchanged this week. Manufacturing activity in both the New York and Philadelphia regions contracted in September. Moreover, the Federal Reserve Board reported that households lost nearly $150 billion in net worth in the second quarter, representing the first quarterly decline in a year.”

“Meanwhile, recent data on the housing market were mixed. The Census Bureau reported that new housing construction dipped five percent in August to an annual pace of 571,000 homes, and homebuilder confidence remained near record lows for September according to the NAHB/Wells Fargo Housing Market Index. Existing home sales, however, rose to 5.03 million homes in August, which represented the strongest annualized rate since March of this year,” he added.

30-Year Fixed Rate Mortgages US NE SE NC SW W
Average 4.09 4.08 4.16 4.09 4.14 4.02
Fees & Points 0.7 0.7 0.8 0.6 0.7 0.8

15-Year Fixed Rate Mortgages US NE SE NC SW W
Average 3.29 3.30 3.30 3.27 3.36 3.26
Fees & Points 0.6 0.6 0.7 0.4 0.6 0.6

5/1-Year Adjustable Rate Mortgages US NE SE NC SW W
Average 3.02 3.09 2.95 3.16 3.04 2.89
Fees & Points 0.6 0.5 0.6 0.3 0.7 0.6
Margin 2.74 2.74 2.75 2.72 2.76 2.73

1-Year Adjustable Rate Mortgages US NE SE NC SW W
Average 2.82 2.88 2.72 3.16 2.70 2.68
Fees & Points 0.6 0.7 0.6 0.4 0.6 0.5
Margin 2.76 2.80 2.75 2.73 2.77 2.75

The National Mortgage Rate Snapshot One Year Ago One Week Ago
  30-YR 15-YR 5/1-YR 1-YR ARM 30-YR 15-YR 5/1-YR 1-YR ARM
Average 4.37   3.82   3.54   3.46   4.09   3.30   2.99   2.81  
Fees & Points 0.7   0.7   0.6   0.7   0.7   0.6   0.6   0.6  
Margin N/A N/A 2.75   2.77   N/A N/A 2.74   2.76  

Tags: 15 year fixed, 30 year fixed, fixed rate mortgage, freddie mac, interest rates, mortgage rates, 5-year hybrid, 1-year treasury

Source:
Freddie Mac